Extending its scope of application, blockchain has found a new usage in the financial technology domain. According to the latest development, four banks have pilot-tested a project of issuing a promissory note on the open ledger successfully, and results are quite encouraging. A news release in this regard confirmed the development and said that compared to the customary procedure, application of blockchain has reduced the number of steps involved in the process by more than 50%. This means not only the time is taken in completing the process has reduced drastically, but also there are financial savings associated with the process, for both customers and the financial institutions.
Merits of Blockchain for Promissory Note
Another advantage associated with using the blockchain platform to issue the promissory note is the elimination of the need for the banks or financial Institutions to hold the documents in their physical form. On the borrower side, the people need not send anything valuable in order to avail the facility of loan. In sum, both the parties are expected to get benefit out of the blockchain adoption while making the procedures simpler and uncomplicated. The four banks which are part of this pilot are Helaba, DekaBank, DZ Bank, and DWPbank. Enthused by the result, the corporations are now planning to replicate this project for the entire banking industry, and in a way, it is going to help adoption of blockchain technology further in banking and finance industry.
Officials at the banks are quite happy with the results and according to Peter Tenbohlen, who is heading the operations at DZ bank said that owing to the digitization, customer expectations have now increased manifold times. We are happy to announce this new platform for further facilitating convenience to consumers. This new facility which is backed by four banks is really going to provide a new kind of experience to customers in which all the trading and transactions will be processed automatically without wastage of time and money.
Just so you know, Helaba is one of the prominent banks in Germany and recently it has joined Marco Polo network which is a trading network based on open ledger technology. This association is now culminating into a progressive partnership as the bank has now fully integrated blockchain into its portfolio of products and services. In the related development, we have already witnessed a slew of global banks now joining the blockchain syndicate platform for making the loan processing and payment processing fast and easy. These banks are now using blockchain platform of R3 Corda, which is the quite well-known blockchain solution provider in the industry. According to industry experts, there are quite a number of use-cases of blockchain in the banking and finance domain, and this new edition is going to further consolidate the position of technology in the industry. The merits of using blockchain here in the case of issuing promissory note are quite substantial, and these savings are sure to attract other industry players to follow suit.