Following on from our initial look at how Blockchain is helping banking institutions become more effective with their operational processes, in part two we focus on how the technology is enhancing specific areas and processes.
Improved Efficiency Through Automation:
Smart contracts are changing many aspects of business processes, and are doing so significantly in the banking sector too. Their automated execution of agreements makes transactions faster, as well as reducing administrative costs.
Better Compliance and Risk Management:
Blockchain brings transparency and enables a tamper-proof audit trail, which in turn assists with regulatory compliance.
By virtue of its decentralized nature, Blockchain also reinforces risk mitigation and helps avoid costly fraud and errors, thus reducing losses.
Data Integrity and Quality:
Blockchain’s singular source of data, which as mentioned above is also tamper-proof, means data quality is improved and costs associated with data reconciliation are reduced.
Real-time visibility of Blockchain data also means errors can be identified and rectified earlier, thereby preventing larger scale issues.
Scalable Transaction Volumes:
Handling increased transaction volumes is a benefit Blockchain provides, and without the often-associated significant cost increases. Banks are able to process more transactions in an efficient way, without adding to their overheads.
The descriptions provided above are all based on publicly available information, and cannot be considered as financial advice or encouragement to invest. Sources of information used in this article include FinTech Magazine, Accenture and Forbes. All transactions involving digital assets involve certain risks, which you should familiarize yourself with prior to any investment.