BLOCKCHAIN - Reinventing Banking

Indian banks are readying to adopt blockchain, which in its matured format, is expected to change the face of banking:

One of the most discussed topics in the financial services industry today is blockchain. When it becomes a fully mature technology, it is expected that banks will be able to process payments almost real time, absolutely accurately and reduce transaction processing costs. It has been found that the technology can keep track of transactions, track ownership, become a reliable and tamper-proof source of information about almost any type of property, create smart contracts and when combined with open banking, lead to faster, automated lending decisions in a marketplace, promote and facilitate financial inclusion in a more efficient manner and control and eliminate frauds. However, what we today know about blockchain is very limited compared to the scope it has, especially in areas other than banking, like in regulation, privacy, data protection etc.

For banks to be making use of its true potential, there is need to build a right infrastructure - and a rugged network. More than this, there is the vital requirement for all the stakeholders to define and establish rules of engagement.

“One of the most talked-about topics in the financial services industry today is blockchain banking and when fully adopted, it will enable banks to process payments more quickly and more accurately while reducing transaction processing costs,” says Sunita Handa, Chief General Manager (IT - Channels & Operations), State Bank of India. “However, to capitalize on this potential, banks need to build the infrastructure required to create and operate a truly global network using solutions based on this transformative technology,” she adds.