Smart Contracts for Conditional Payments in Pharmaceutical Supply Chains

Manual invoice reconciliation is a major source of friction and delay. A smart contract can be programmed to automatically release payment upon receiving a verified proof-of-delivery signal from an IoT sensor or a signed digital receipt. This reduces Days Sales Outstanding (DSO) by 30-50% and frees up working capital.

• Example: A logistics company pays carriers automatically when GPS and temperature data confirm goods arrived in-spec.
• ROI Driver: Reduced administrative overhead and faster settlement cycles.

Large projects involve phased payments tied to milestones, often requiring manual audits. Smart contracts create self-executing escrow. Funds are locked and released only when objective evidence (e.g., a project management system update, a third-party inspection report) is submitted to the blockchain.

• Example: A construction firm automates payments to subcontractors upon verified completion of foundation, framing, and roofing stages.
• ROI Driver: Eliminates payment delays, reduces audit costs, and builds trust across the supply chain.

Claims processing is notoriously slow due to manual verification. Parametric insurance smart contracts can trigger instant, transparent payouts based on trusted external data feeds (oracles) for predefined events like flight delays or natural disasters.

• Example: A flight delay insurance policy pays out automatically if a certified data feed confirms a delay exceeds 3 hours.
• ROI Driver: Dramatically lowers processing costs, improves customer satisfaction, and reduces fraud risk.

Tracking intellectual property usage and ensuring accurate royalty payments is complex and often inaccurate. Smart contracts can be attached to digital assets (e.g., software, media) to automatically calculate and disburse payments each time the asset is used or sold.

• Example: A music streaming platform uses smart contracts to instantly pay artists and rights holders per stream, with transparent revenue sharing.
• ROI Driver: Ensures compliance, reduces administrative burden, and provides real-time revenue visibility for creators.

High-value B2B transactions require trust between unfamiliar parties. A smart contract acts as a neutral, automated escrow agent, holding the buyer's payment until the seller provides proof of shipment or service completion. Both parties agree to the rules upfront.

• Example: A manufacturing parts marketplace holds payment until IoT sensors confirm the shipment left the warehouse.
• ROI Driver: Enables new trading relationships, reduces counterparty risk, and minimizes chargeback fraud.

Suppliers often seek early payment for invoices at a discount, but manual processes are cumbersome. Smart contracts can facilitate dynamic discounting programs where suppliers can selectively offer discounts for early payment, with the contract automatically calculating the adjusted amount and executing the transfer.

• Example: A supplier submits an invoice with a 2% discount if paid within 10 days. The buyer's system triggers the smart contract for immediate, discounted settlement.
• ROI Driver: Buyers capture discounts as a return on cash; suppliers improve liquidity. Creates a win-win financial tool.

The Pain Point: A cross-border shipment requires a 45-day manual process involving banks, carriers, and customs, with high fees and fraud risk.

The Blockchain Fix: A smart contract holds buyer funds and automatically releases payment upon receiving verifiable proof-of-delivery (e.g., IoT sensor data at port). This slashes settlement from weeks to minutes.

Real ROI: Maersk and IBM's TradeLens demonstrated a 40% reduction in document handling costs and a 90% faster document processing time for similar use cases.

The Pain Point: Filing a claim involves lengthy forms, manual adjuster reviews, and slow payouts, damaging customer satisfaction.

The Blockchain Fix: A parametric insurance smart contract triggers an instant, automatic payout when an objective data feed (oracle) confirms a triggering event (e.g., flight delay > 2 hours, rainfall exceeding 10cm).

Real Example: Etherisc offers flight delay insurance where payouts occur automatically if a flight data oracle confirms the delay, eliminating claims paperwork and processing costs entirely.

Automate letters of credit and milestone payments in global trade. Funds are released automatically upon verifiable proof of delivery (IoT sensor data, customs clearance on-chain), slashing processing time from weeks to minutes.

• Example: A consortium like we.trade uses blockchain to automate payment upon bill of lading verification.
• ROI Driver: Reduces administrative costs by up to 80% and accelerates cash flow by eliminating manual document reconciliation.

Transform claims processing with parametric insurance. Smart contracts trigger instant, transparent payouts when objective conditions (e.g., flight delay data, verified weather events) are met, without claims adjuster intervention.

• Example: Etherisc offers flight delay insurance where payouts are automatic if a flight is delayed beyond a set time.
• ROI Driver: Dramatically lowers operational costs (fraud prevention, manual processing) and improves customer satisfaction with near-instant settlements.

Enable usage-based and tiered billing with zero revenue leakage. Contracts can dynamically adjust charges based on verified API calls, storage used, or active users, with automatic proration and cancellation.

• Example: A SaaS platform could use a protocol like Superfluid for real-time, streaming subscriptions.
• ROI Driver: Ensures 100% accurate billing, automates dunning processes, and unlocks new, granular pricing models to capture more value.

Automate and transparently enforce intellectual property agreements. Smart contracts can distribute royalties instantly and proportionally based on verifiable sales data (e.g., NFT secondary sales, streaming counts), ensuring creators are paid fairly.

• Example: Music protocols like Audius use blockchain to automate royalty splits to artists and rights holders.
• ROI Driver: Eliminates complex, manual royalty accounting, reduces administrative overhead, and builds trust with content creators through transparency.