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Community Blog Securing Deliveries with Smart Technologies

Securing Deliveries with Smart Technologies

Alibaba Cloud and Credits have partnered up to develop a transparent, blockchain-powered Smart Payment Service to streamline operations and reduce costs.

Credits Blockchain and Alibaba Cloud Based Smart Payment Service

The rise of globalism as a model of economics has interconnected our world beyond recognition. Now, Alice can order any product she wants from Bob, who resides on the other end of the world. The products can be anything from a cheap trinket made in China to gigantic shipments of household appliances or industrial equipment. But all of these transactions need intermediaries capable of carrying out the delivery and ensuring its safety and integrity, and that is not as simple as it may seem.

The problems of a lack of trust between the parties involved in the product delivery process and the associated inflated costs are hampering the growth of the logistics industry and the purchasing power of both private and corporate buyers. But by merging together advanced technologies, we have developed a product capable of giving much more to the parties involved than just streamlining operations and reducing costs.

Smart Delivery

Smart systems and infrastructures have arisen in recent years on the basis of blockchain that has greatly facilitated the interaction between buyers and sellers through the use of the technology’s unique characteristics. We have analyzed the capabilities of the new technology and developed the Smart Payment Service based on the Alibaba Cloud and the Credits blockchain platform as one of the most advanced solutions for the logistics industry. The product has recently seen its debut as a facilitator of the entire transaction process from ordering to delivery receipt sign off. The product is intended, first and foremost, for safe transactions between the seller and the buyer as part of express delivery of goods by logistics providers like DHL.

The Credits blockchain platform has stepped in as the infrastructure for the implementation of the Smart Payment Service. Credits is an open-source and fully decentralized blockchain software protocol operating on the basis of smart contracts that are designed for high-performance applications through the use of the unique PoA (Proof of Agreement) algorithm based on BFT conception.

By being based on the Credits blockchain, the Smart Payment Service can reliably provide safe transactions between the seller and the buyer as part of the express delivery service provided by logistics providers like DHL. The combination of Credits blockchain smart contracts, the Alibaba Cloud infrastructure and payment systems providing APIs for free access, for example Alipay, has resulted in a convenient and user-friendly service that is poised to revolutionize the logistics industry.

"Here you can see one of the greatest value of blockchain. The supply chain is the best use case for that. The combination of traceability, transparency, and accountability is the main reason why blockchain enhances the industry. Companies can get a real competitive advantage by using technology. The mass implementation is just a matter of time”, Yuli Bai, CEO of Lenovo New Vision.

Any service based on smart contracts allows its users, such as Alice and Bob to automate the transfer of funds from one owner to another when certain conditions are met. The payment is made automatically when the buyer receives the goods delivered by logistics providers, as the smart contract’s terms are immutable and stipulate instant execution.

Why So Difficult?

The logistics industry is an immense web of interconnected intermediaries from all over the world operated by humans, not by automated systems. The presence of the human factor gives rise to errors and constant delays due to the immense amount of bureaucratic procedures and paperwork involved in the goods delivery process. In fact, the problems of the industry can be boiled down to several main factors, namely the lack of trust between the parties in the delivery process and the high resource costs involved in clarifying the circumstances of a transaction.

The Smart Payment Service on the Credits blockchain platform is designed specifically to target the two main factors hampering the development of the logistics industry and increase its efficiency. The goal is ambitious, but the combined efforts of the companies developing the solution and the merger of unique technologies like Credits and Alibaba Cloud have resulted in the creation of a product capable of offering its users more than just speedy deliveries.

The service Credits has developed ensures the protection of transactions related to the delivery of goods, as the service acts as a guarantor by relying on the technologies serving as its basis. Based on Alibaba Cloud Elastic Compute Service (ECS) instances (ecs.g5.large - 8 Memory, 2 vCPU), we run private blockchain Node infrastructure for logistic companies in China. It is also a low-cost solution for processing business tasks, since the Credits blockchain has some of the lowest per transaction costs on the blockchain market starting at $0.001. Full delivery process automation by the Smart Payment Service and the exclusion of the human factor will allow companies to optimize business environment of delivery services.

Credits node is is a computer where a complete network client is installed, connected to a common system, verifying transactions and writing them to the ledger. In order to build high-performance and fast applications on the Credits blockchain, the customer can use Alibaba Cloud Services to deploy the node for an application remotely in the most cost-effective way. The whole process looks like this:

1) Sign up an account on Alibaba Cloud
2) Get an access to virtual computing environment that includes the CPU, memory, OS, bandwidth, disks, and other basic computing components in the Elastic Compute Service
3) Install git on Alibaba Cloud instance
4) Install Credits node software
5) Set up environment variables
6) Connect your application to Credits network

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The combination of some of the most advanced IT technologies in one product grants ample opportunities for integration with external applications and gives online stores untapped possibilities for expanding globally without the restrictions imposed by delivery companies. Most importantly, the Smart Payment Service’s Credits blockchain basis ensures fully traceable payments and makes accounting a transparent process.

How It’s Done

The concept and process of using the Smart Payment Service is a simple one and does require either vendors or buyers to delve into any programming. The use of convenient APIs makes the use of the service as simple as interaction with any average application on a computer or a mobile device. The following example of interaction between Alice and Bob will act as an illustration of using the Smart Payment Service.

To start with, as in the vast majority of cases of goods delivery ordering, Alice does not know Bob and is not sure that he will transfer the payment to her once the order is placed. There is a problem of mistrust between the parties. To make sure that trust is eliminated as a hampering factor to the transaction, Alice creates a smart contract in the Smart Payment Service, which serves as the guarantor of payment. Alice then inputs the delivery data and clicks on the “Create Contract” button.

The service automatically creates an escrow smart contract on the Credits blockchain operated on the Alibaba infrastructure. Alice then sends the delivery package using DHL, and the delivery service provides delivery information in turn.

On the other end of the world, Bob accepts the contract terms and sends funds via a payment system like Alipay to the Credits smart contract. The funds are then placed on hold until the fulfillment of the conditions of the delivery. A few days later, Bob receives the package from DHL and signs the acceptance invoice. Once Bob signs the receipt, DHL sends a command to the smart contract of the Credits blockchain that acts as a delivery trigger. This command unlocks Bob’s funds on the smart contract and the blockchain sends it to Alice’s account as payment for the goods.

Alice receives the funds on her account once they are unblocked and has the option of converting them into another currency or cashing it out by using a payment service.

Technologies Decide

The modern logistics industry is no so much about moving goods around the world as it is about the supporting actions, such as filling out paperwork and verifying documentation. The supporting actions result in time delays and costs associated with vast amounts of wasted paper and other resources needed to make the workflow process running. The ones most affected by the delays and costs involved in the delivery process are the buyers, who are forced to wait longer for their goods and pay for the intermediaries involved in the process.

The automation of the delivery process is the only logical solution to increasing the efficiency of the logistics sector. Blockchain technologies are an important ingredient in the mix that has risen as a possible solution to the problems that have been plaguing the industry. The Credits blockchain platform, with its low transaction costs and network throughput capacities starting at 50,000 transactions per second with 0.1 second processing times, is a suitable, reliable and secure infrastructure for supporting applications like the Smart Payment Service.

But blockchain alone is not enough to make the revolution of automation possible. The vast amounts of data involved in the delivery process will be handled by the Alibaba Cloud system, which has proven its reliability through years of successful operation. The Smart Payment Service is the result of a merger of technologies and is the most convenient and cost-effective solution to delivery processing available on the market.

The delivery process in the 21st century should not have to involve needless paperwork or incur extra costs, especially when buyer purchasing power suffers as a result. It is high time to take advantage of the technologies opportunities available and make the transition to using solutions like the Smart Payment Service.

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