This story was delivered to BI Intelligence " Payments Briefing " subscribers. To learn more and subscribe, please click here . Bank of America Merrill Lynch and HSBC have teamed up with the Infocomm Development Authority of Singapore (IDA) to test blockchain applications for global business-to-business (B2B) transactions, according to the International Business Times . The firms have designed a proof of concept, using technology from the Hyperledger Project, that could take the place of letters of credit — the time-consuming and paper-heavy instruments used by importers and exporters to secure cross-border transactions, according to Reuters . This is yet another way that the financial-services sector is looking to use blockchain — the distributed ledger technology known for powering cryptocurrency — to increase efficiency and security for a variety of processes. The technology could collectively save banks up to $20 billion annually by 2022, according to Santander . Blockchain technology, which is best known for powering Bitcoin and other cryptocurrencies, is gaining steam among finance firms because of its potential to streamline processes and increase efficiency. The technology could cut costs by up to $20 billion annually by 2022, according to Santander . That’s because blockchain, which operates as a distributed ledger, has the ability to allow multiple parties to transfer and store sensitive information in a space that’s secure, permanent, anonymous, and easily accessible. That could simplify paper-heavy, expensive, or logistically complicated financial systems, like remittances and cross-border transfer, shareholder management and ownership exchange, and securities trading, to name a few. And outside of finance, governments and the music industry are investigating the technology’s potential to simplify record-keeping. As a result, venture capital firms and financial institutions alike are pouring investment into finding, developing, and testing blockchain use cases. Over 50 major financial institutions are involved with collaborative […]
