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4 Reasons to utilize Blockchain Technology in Banking

Nov 25, 2017 Posted /  4054 Views

4 Reasons to utilize Blockchain Technology in Banking

Blockchain is a technology which allows various users to have concurrent access to a continually updated digital ledger. Multiple parties regulate its authenticity, which leaves no room for alteration or manipulation.It is significant in today’s age to clear your mind from the pre-conceived thoughts and begin with a fresh perspective by adopting technology solutions like Blockchain which can have an essential difference in your life.  

There had been extensive research going on the ways Blockchain can help in the Banking sector. The doubters of this technology compare taking reference of the vulnerability Bitcoin faced in the previous years. However, it is important to understand here that Bitcoin and cryptocurrencies are one segment which deploys the technology and its appositeness remains far wider than our imagination.

The Blockchain market in the first half of the year 2017 elevated and raised a venture of around $240 million. It was surveyed that the significant portion of the investment came from the banking sector. This can itself attest the copious faith that Banking is putting on this new technology because any new venture initiated in the banking sector needs to be validated by the consortium of the banking corporations.

So why is Blockchain technology is going to be the necessity of the Banking sector?

Clarity of records in settlements: Banking data comprises of records of loans, investments, securities and other financial evidence. Most of them are tangled, fuzzy and inaccessible at the time of settlements. It is estimated that Banking can save comprehensive time and money by using blockchain technology which can substantiate the data in a more clear manner. Right now the industry is entrenched in the web of manual record keeping and reconciliation. Blockchain with its smart features can enormously change the infrastructure of the sector.  

Easy payment options: Blockchain technology has the most potential application in easing out the payment systems. Right now banking face much of its critique owing to the time it consumes to transfer and process payments. Blockchain technology can shift this burden from the banking sector by optimizing their payment process. They can also utilize the cryptocurrency options with dealings that involve huge finances and extensive regulation formalities. More of these projects are taken by the small and private banks who exclusively depend on the central banks.

Financing and trading: Though we call this as digital age but still most of the trading and financing work depends upon manual documentation, permissions, credit letters and human screening. Blockchain in this matter can be the ultimate solution for the banking entities who need remittances, clearances to modify their dealings with respect to the modern world. The technology leverages on the distributed ledger system which means that multiple parties can access information simultaneously. Surprisingly much of the trade finances work is done through faxes and stamping by the authorities. The answer could be digitizing the trade with the help of blockchain solutions.

Identity thefts and hacking: Identity thefts and hacking have been the area of concern for the most of the world today. People have witnessed their years of hard-earned money vanish in a matter of seconds. Blockchain technology can be leveraged to verify and authenticate the customer's identity. It is almost impossible to altercate any information updated on the blockchain, as it depends upon a shared network of users who confirm the identity.  

Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .

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Tags: blockchain technology banking blockchain bitcoin

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