Blockchain has an array of characteristics, but not limited to, decentralization, transparency, security, and immutability. These characteristics and more make it an extremely appealing choice for businesses across the world.

1. Blockchain Transforming the Banking Sector
Invented back in 2008, the Blockchain technology has proved that it has
the power to completely overhaul the operations in many business
areas. So much so that there aren’t many imaginable domains that are
not already ​overcoming their legacy challenges thanks to
Blockchain-based solutions​. Blockchain has an array of characteristics,
but not limited to, decentralisation, transparency, security, and
immutability. These characteristics, and more, make it an extremely
appealing choice for businesses across the world. One such domain that
is leading the way in exploring Blockchain and its implementation is the
banking sector.
The banking sector is one that is extremely strictly regulated in all
jurisdictions, while the bank officials and even the sector
representatives are known for their conservative attitudes. But owing
to the wide dissemination of blockchain in the past half a decade
coupled with the ICO boom has contributed to the fact that many banks
management and financial organisation no longer deny the possibilities
that Blockchain brings with it. So much so that they’re all set to
embrace the powers that come along with a Blockchain
implementation.

2. Large banks have started conducting tests of decentralised asset
technologies and implementing the Blockchain technology in their
business processes. Further, they are also investing in a number of
startups, projects, and researches that will help come up with even
better Blockchain-based solutions.
Accenture consulting company, that specialises in strategic planning,
conducted a study of various banks. It was found out that more than
50% of all the top level managers admit that the Blockchain technology
is surely going to play an unprecedented role in the success of financial
firms in a very near future. The analysts at Accenture found out that the
world financial sector will save up to $20 billion by 2022 just by
implementing Blockchain-based solutions. .
Blockchain: The ultimate panacea for financial firms
Blockchain-based solutions can easily help solve a lot of problems that
these banks and financial organisations were traditionally facing.
Because of the various characteristics, the Blockchain-based technology
comes as an extremely attractive option. Almost as attractive as Linux
(because of its transparency) and Skype (owing to the Voice over IP
protocol) when they were first brought into existence.
The security that comes with Blockchain-based solutions is something
that was always wanted but was difficult to achieve. By providing a high
level of safety and security in storing and transmitting data, open and
transparent network infrastructure, and a decentralised infrastructure
coupled extremely low cost of operations, the Blockchain technology

3. has emerged as the ultimate panacea for banking and financial
institutions.
When we talk about credit and financial institutions, they simply cannot
carry out work without a number of mediators. This pool of mediators
not only adds complexities in terms of operations but also makes the
whole process much more expensive. Using Blockchain-based solutions,
these institutes will be able to completely eliminate unnecessary
mediators – this will result in faster, safer, and cheaper services.
It doesn’t come with any surprise that out of all the industries currently
using Blockchain implementations, the financial sector tops the list.

4. Which solutions are helping banks overcome legacy challenges?
The main outcomes of implementing these Blockchain-based solutions
for the financial institutions are the ability to reduce cost and make the
transfer faster. The benefits that it provides to cross border payment
cannot be overstated either. As of now, the number of days required to

5. process a cross border payment are extremely high. Add to that the
deductions in money while it is transferred from one place to the other.
Using Ripple or other cryptocurrencies that are based on the Blockchain
technology can help reduce the gap of days between payment being
made and payment being received.
Another field of Blockchain application for banks and financial
institutions is the creation of a client identification system that works
on distributed ledger technology. This is extremely useful because all
the credit organizations mandatorily perform Know Your Customer
while processing any application. It also helps FinTech firms onboard
customers quickly and seamlessly. Using Blockchain-based solutions,
these firms can enable their users to be identified on a single occasion
and store that information securely with access granted to other banks
in the system.
Further, the domain of banking and finance is closely related to
ensuring deposits and loans. Even in the developed nations, most of
these banking operations are often called out for reasons like lack of
security and unreliability. A distributed system based on the ledger
technology will come in handy for P2P lending. Such a system for loans
and deposits will be completely decentralised, and since the deposits

6. are not in control of any one organisation, the system can never really
go bankrupt.
Decentralisation is something that will absolutely guarantee stability as
well as reliability.Another excellent use case of Blockchain in banking is
that in Trade Finance. Using Blockchain-based solutions can drastically
reduce processing time, eliminate the use of paper, and help save
money – all the while ensuring transparency, trust, and security. By
removing bad actors and forcing everyone involved to play fair, these
Blockchain-based solutions are completely overhauling Trade FInance.

7. A subordinate to the Polish Bank Association – The Credit Data
Processing Bureau – recorded the credit histories of around 150 million
Europeans. A British fintech organisation by the name Billion Group last
year received EUR 1 million of investments from the EU last year.
They’ve created a unique Blockchain-based solution that allows the
bureau to easily process customer data.
The bureau’s management believes that these Blockchain-based
solutions and services truly comply with the legal requirements along
with the data protection regulation. To add to that, these solutions also
meet the needs of industry and increase efficiency. The product offered
by the Billion Group is currently being implemented and tested by ten
major Polish banks. The management of these banks is pretty confident
that it is what the industry needed, and that these Blockchain-based
solutions will radically transform the way personal information is stored
and transferred between banks and clients, for the better.
One of the representatives of the Billion Group said that the company
continues to develop and introduce Blockchain-based solutions not
only for better data processing and storing, but also to help operations
that involve fiat money. Their target is to revolutionise the way data is

8. managed and store so that users have full control of their personal
data, and neither of confidentiality or security is compromised.
Grupo Santander, the largest Spanish banking group and also one of the
leaders in the UP, has pioneered the implementation of
Blockchain-based solutions in the banking sector. Controlled by the
Banco Group, this group has successfully implemented a fully
functioning system that goes by the name One Pay FX. This system runs
on Blockchain and its primary goal is to use distributed ledgers to
optimise payments between Europe and South America.
The Spanish bank has also launched a service aimed solely at
accelerating international banking transactions, and thereby reducing
the costs that the firms have to incur while processing them. This
service runs on Ripple Blockchain – something that is well-known,
thanks to its cooperation with American Express, Western Union, and
other major players from the banking sector. Santander is also testing
and developing a Blockchain solution that’ll help carry out shareholder
voting as per the needs of major partners, including Northern Trust,
Broadbridge, and JPMorgan Chase.
JPMorgan Chase is a firm believer in the future of Blockchain. So much
so that they’ve assigned a separate enterprise – the Quorum division –

9. to study, research, explore, and implement this technology. JPMorgan
is continuously testing applications for financial processes and has
already issued an annual deposit certificate with a floating rate. This
certificate is based on a distributed registry.
Another leading player, Goldman Sachs, actively supports, studies, and
promotes distributed registry technology. They have already invested in
the Circle cryptocurrency project. ​Bloomberg reports that the bank
intends to become a leader in the use of Blockchain and cryptocurrency
among all its Wall Street competitors. For this, they’re creating their
own cryptocurrency unit which exclusively deals with digital currency
trading operations.
Talking about RBI or the Reserve Bank of India – the governing
authority of Indian banks, it has shown an active inclination towards
Blockchain and related solutions. The IIDRBT (India’s Institute for
Development and Research in Banking Technology) has been actively
working on the use of Blockchain for banking systems.
The matter of fact is that it’s not only large banks and institutions that
are supporting and thus implementing Blockchain-based solutions.
Every firm that operates under the financial or banking sector can use
this opportunity to dedicate some time and efforts towards

10. understanding Blockchain-based services and finding out solutions to
their problems.
How does the near future look?
The Blockchain technology can have a tremendous impact on the
procedures that involve concluding and confirming transactions,
optimising assets, and managing cash, among many other business
processes that otherwise cost billions of dollars for banks.
These solutions are extremely fast, secure, and transparent than any
other system or approach that these institutions have taken in the past.
Banking is certainly one of the most promising spheres that is reaping
the benefits of Blockchain-based solutions.
Making it possible to extremely reduce the time frames, Blockchain has
become accepted and established. Think about the time from a loan
application being approved to the actual loan being received, or the
time it takes for inter bank or international transfers, and the time for
processing, and so on. Using the decentralised Blockchain technology,
these firms can help reduce exactly those time frames.

11. As of today, the Blockchain technology has surpassed the point where it
was just a dreamy idea for the banking sector. It is already being
successfully implemented, as we discussed earlier, too. The future, too,
looks extremely bright when it comes to Blockchain and banking.
The technology will provide banks with speed, efficiency, security, and
reduced costs in many of their operations. It’ll not only be a boon for
the banking institutes, but also for their end user. Further, looking at
the pace at which the Blockchain domain is undergoing research, it’s
fair to say that the future surely holds a lot of improved and even more
useful use cases for Blockchain in banking.
Connect to us
We, at Minddeft, bring constant technological innovation to your
business by leveraging the potential of Blockchain technology.Our
expertise lies in Ethereum, Hyperledger, Quorum, Python, React and
most popular platforms related Blockchain.
Drop us a line​ to discuss how can we help you.