One of the most principal areas of blockchain use seems to be the finance industry and more and more banks are warming up to the need for adopting this technology. Especially in the field of user identification, blockchain can play a major role.
As we have mentioned in one of our earlier articles, blockchain can impact the banking industry in a major way. The most common application occurs in the way of setting up payment systems.
Blockchain Technology is often used to replace the SWIFT money transfer system of the banking industry. Given that blockchain ensures a decentralized platform for facilitating speedy, low-cost transactions, blockchain can be an excellent way to make cross-border payments more efficient.
Now, it seems that more and more banks are exploring some other applications as well.
According to latest reports, it seems that 5 banks from Canada are looking to use a user identification system built on blockchain technology soon. This system, is being developed by a technology startup called SecureKey Technologies. The name of this system is called the Verified.Me digital identity system.
Verified.Me will be available for use to clients of five major banks: the Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia, Canadian Imperial Bank of Commerce and Desjardins Group. Two more banks are supposed to come onboard pretty soon as the service over this blockchain system will be made available to those who have accounts with the Bank of Montreal and the National Bank of Canada.
A North American insurance company, the Sun Life Financial will also be making use of this Verified.Me blockchain system. As per reports, Greg Wolfond, the Chief Executive Officer (CEO) of SecureKey said that by the time the year draws to an end, consumers will be able to make use of this service to provide identity proofs and open bank accounts. This will also enable them to use government services by proving identity. Wolfond went on to state:
“They’re going to be able to share their data in a secure and trusted way, which they never really could before.”
The decision to adopt this new blockchain-based adoption system constitutes these banks’ collective decision to move towards a more open banking system, where consumers can easily allow for their financial information to be shared with other third party companies. This move was initiated by the Canadian Bankers Association and with the SecureKey blockchain solution, is slowly gaining ground.
The use of blockchain in banking seems to be catching on and for good reason. With the amount of accountability, transparency and immutability that a distributed ledger on the blockchain can ensure, banks can definitely take their services a notch higher.
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