As a Distributed Ledger Technology (DLT), Blockchain has shown tremendous growth in various markets. In the financial sector, Blockchain has the capability of scaling the operations to the next level of excellence. Therefore, Blockchain and Finance Sector is said to have an undisputed correlation.
Financial sectors are always facing network problems and security breaches and for bottlenecking these adversities, they have made plentiful investments in services and applications. Of the various finance sectors, Banking industry has shown a drift towards doable practices and has cut shorted the conventional ways of carrying out operations.
The Blockchain technology ledgers favored bilateral settlements by waving of faulty intermediaries, delays, collateral costs, nullify credit risks, faster transactions, elevated transparency in operations, amongst the others. The three main properties exhibited by Blockchain technology namely Decentralization, Transparency, and Immutability best favors the finance sector.
The banking and insurance sector can benefit from the following advantages that Blockchain offers:
- Traceability of operations
- Upgraded payment systems
- Better infrastructure
- Less operational cost
- Reduce errors and falsifications
- Administering trade finance
- Centralized repository to access real time data
- Recording of operations and transactions assuring bank’s security over the records
- Offer cryptographic protection ensuring identity