India is one of those regions in the world where a lot of things are destined to change very soon. The country’s largest bank has taken a keen interest in blockchain technology, as they want to use distributed ledgers to combat fraud. By bringing together the country’s biggest lenders and tech companies on this blockchain venture, things will get very interesting in the near future.
India To Embrace Blockchain Technology
The concept proposed by the State Bank of India is quite intriguing, to say the least. Rather than use blockchain technology for just financial transactions in the traditional sense, SBI wants to rely on distributed ledgers to address the country’s bad loan issues. In fact, these bad loans represent nearly one-fifth of all banks’ loan books right now. It is evident something will need to change before things get out of hand even further.
As one would expect from such a venture, the State Bank of India is looking to dub this platform under a different name. Bankchain is not the most original name in this regard, even though it leaves not much to the imagination as to what this technology will be used for. It is also worth mentioning this new venture is made possible thanks to a partnership with IBM, Microsoft, KPMG,, and nearly a dozen of commercial banks throughout the country.
Albeit most people know the blockchain as the technology powering bitcoin, it is doubtful SBI will use an open blockchain protocol for their venture.Considering how this platform is designed to be used as a centralized registry accessible by all members, it is more likely a private blockchain will be used in the process. For now, the “consortium” is in talks with private companies to develop this solution, although no specific details were unveiled at this time.
What we do know is how this blockchain venture will be rolled out in stages. First of all, the goal is to start with trade finance and loan documents to be put on this new blockchain. Having bankers digitally sign documents will make them accessible to all members of this blockchain consortium. Right now, these documents are either exchanged physically or via email, neither of which is secure or tamper proof.
India is not different from the rest of the world in that the country has different banks working on their own unique blockchain projects right now. A universal payment service than can be used by all banks in the country will help India recover from its recent financial debacle. Blockchain technology is designed to be a universal solution, rather than letting only one bank use it as a “proprietary system”.
JP is a freelance copywriter and SEO writer who is passionate about various topics. The majority of his work focuses on Bitcoin, blockchain, and financial technology. He is contributing to major news sites all over the world, including NewsBTC, The Merkle, Samsung Insights, and TransferGo.