It is always interesting to see banks explore blockchain technology in any capacity. Especially when one of these trials finally resulting in something tangible. Several Asian banks have come up with a blockchain-based solution which is KYC compatible. That in itself is rather interesting for various reasons. It appears this KYC ledger will be used for validating sharing customer information by these banks.
This new ledger is a joint effort by OCBC Bank, MUFG, and HSBC. Additionally, the Singapore Infocomm Media Development Authority is also involved in the process. Being able to develop a know-your-customer blockchain is pretty interesting as a whole. Although it is not necessarily something everyone will approve, the concept has a lot of potential as a whole. Collecting, validating, and sharing customer information on a permissioned blockchain is the main objective of this project, by the look of things.
KYC Blockchain Prototype can be Successful
As a result, this new ledger will get rid of any data discrepancies between the partners of this project. Moreover, this ledger allows partnered banks to store secured digital records of the KYC validation process. This allows them to streamline auditing and regulatory reporting as well. Although this is merely a prototype, its initial tests are pretty promising so far. The initial tests were performed between February and May of this year.
OCBC Bank’s head of e-business Pranav Seth comments as follows:
“This partnership fans the spirit of cooperation among competitors as well as regulatory and government bodies, and we hope this will help foster and inspire more of such collaborative innovation initiatives.Our pioneering efforts have resulted in a KYC process that will not only enhance customer convenience, but will improve the industry’s operating efficiencies while reducing financial fraud and crime.”
Although the usefulness of a KYC blockchain remains to be determined, this is an exciting venture regardless. This new ledger allows all partners to keep up with the growing amount of data they need to process. Moreover, the institutions can ensure confidentiality by restricting access through legitimate authentication. This highlights the benefit of a private and permissioned ledger. It will be interesting to see what the future holds for this venture, that much is certain.
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