Application of Blockchain Technology in Indian Banking System

Before, so many experts explained a detailed analysis of the impact that blockchain will have on the financial industry. Here going to write this article was based on a gathering of opinions from a variety of experts. All the experts shared a variety of insights. They believe that blockchain will create a completely new foundation for the financial industry (banking sector), which will lead to several new upcoming services. Though, the biggest changes will maybe come in the form of new differences in existing services, which can be provided more securely, cost-effectively and timely.

Blockchain Transforms the Financial Industry in Unexpected Ways

As per some experts survey, have started to come to light. Blockchain is already being used by many major financial institutions. Business Insider reports that banks spent $1.7 billion on blockchain technology last year.

Bank of America, Fidelity Investments, Zealand Banking Group, and Citi Bank and HSBC are some of the financial institutions that have made blockchain investing a priority. Early market data suggests that this technology is helping them hugely, but the overall impact on the financial industry remains to be seen.

Blockchain technology is the prize creation of the 4th industrial revolution. As we have seen with other phases of the digital revolution, emerging technologies are disruptive to a wide range of older industries. Previous business models need to change with blockchain. This new technology has rewritten the rules and provided new business models that are considerably more reliable and efficient.

Read on to learn the different ways that blockchain could disturb the banking sector.

1. Payments

If you want to transfer an amount through your any bank account, it will take days to process. If the payment is sent worldwide, then the transactional cost can be important. This process is not coming under bitcoin payments. They are performed via the blockchain and a bitcoin wallet. They take a maximum of 16 hours and do not include third-party confirmation fees.

Note that some bitcoin wallet providers may attach fees to payments, but you can always get value for money and reliability with wallet providers like Luno.

Financial institutions are using the same technology to accelerate their payments. A study by American Express forecasts that 65% of banks will use blockchain to speed up financial transactions by the next upcoming year.

2. Improved Security

Security is one of the most important benefits of blockchain. A Deloitte survey found that 71% of experts trust it is more secure than old-style enterprise IT solutions.

What some people do not understand is that blockchains can be private. They can be used within an organization or can be completely public. Banks are often a target for hackers wanting to bargain sensitive and financial information. The use of a private blockchain within a bank could be used to keep customers harmless - and this could be used in any organization or governmental department.

Unless banks can come up with an equally bulletproof way of defensive their customers. Their hand may be forced and they may have to adopt blockchain for this purpose.

3. Fundraising

New startups can often face difficulty raising funds for their idea. Banks are less likely to lend money today and this has opened up a chance for the blockchain.

Blockchains can be used to power Initial Coin Offerings. ICOs work by allowing the startup to sell bitcoin and other cryptocurrencies. These coins will become valuable depending on the success of the business venture. It is a suitable way for new businesses to seek investment from a wider audience - and reduces the need for a string of bank meetings.

4. Credit Checks

Before a bank agrees to a loan, loan or credit card, they must perform several checks to confirm you can pay back the money they will advance, as well as the terms of the contract such as interest.

Errors within credit scores are not as infrequent as you may believe, and they could wrongfully stop someone from purchasing their dream property. Blockchain could remove doubt from an incorrect credit check and allow people to view their credit history at any time, concurrently allowing them to spot any errors.

Blockchain - Today or Tomorrow?

Blockchain technology may have been around for last so many years, but implementing it within industries away from crypto is relatively new. The most important applications of blockchain in the banking sector may not happen immediately, but they are definitely in the pipeline. Work is still to be done on blockchain technology as it tracks blazes an array of industries. One thing is certain – blockchain is troublesome in the global financial industry as we know it. 

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Also, Read: How much will it cost for Blockchain Training in Bangalore?