A financial services company called Bank of Baroda (BoB) has adopted blockchain technology for gaining the market advantage.
The focus of the technology initiatives of BoB is on its customers. The integral part of the business of BoB is technology. With the purpose to help the decision making regarding its business- supervision, control, and building up of management information system (MIS) are facilitated by a newly created robust technology platform of BoB.
The Head of Fintech & Partnerships and Mobile Banking at BoB is Akhil Handa who has said regarding the adoption of the blockchain in BoB and BFSI sector.
The blockchain technology can help in generating profits in the banking sector. It has been drastically altering sectors like healthcare, energy, and retail along with the banking sector. Decentralization, immutability, and transparency are the features of the blockchain. The blockchain becomes an appealing one for the world’s business sectors and domains due to its features. Banking and finance sectors are now the top-two leaders in the exploration of blockchain potential in various use cases.
Untrusted third parties can reach a consensus without the involvement of middlemen in the blockchain. They can’t administer a ledger. Financial services [payments, remittance or securitization] can be provided by the blockchain without using middlemen like banks. Resolving the trade-offs of data partitioning is a purpose behind the development of the blockchain. Preserving both consistency and availability with the help of various consensus protocols is a promise of the blockchain. A smart contract can be used in a blockchain. Manual processes [compliance, claims, and distributing] regarding content can be automated potentially by the smart contract. Better governance and standards for data sharing and collaboration can be set up with the help of distributed ledger technology (DLT).
At the current, global banking is about $134 trillion industry. The key services of banks can be accessed without intermediaries through the blockchain and DLT. Trade Finance, Payments, Clearance & settlement Systems, Fundraising, Securities, and Loans & Credit are some of the services, MoneyControl reported.
BoB works on Trade Finance, Invoice Discounting, e-KYC, etc related blockchain use cases. BIC, Bankchain, and Trade Connect are the consortiums where BoB participates because BoB is the member of these consortiums. The participant of BoB in the exploration of financial use cases regarding DLT is active.
The phase of the development of blockchain technology is initial. With the purpose to make the blockchain stable than ever, the rapid developments are carried out in different blockchain platforms. Interoperability challenge, Scalability Challenge, and Cost & efficiency are some challenges identified in the situation of implementing the blockchain with BoB’s existing processes and use cases.