Blockchain might be the long awaited technology that will change the world and the future of transactions. While it is not easy to foresee how this technology will be implemented across different industries, there is no doubt that it will bring efficiency, transparency, and enhance privacy and security.
The technology has the potential to change sectors for the better. One of the industries where this technology has already proved to be useful is the banking and financial sector.
Blockchain offers a cryptographic and secure way of sending digital money without the need for intermediaries or third parties such as banks. Moreover, there are other tools such as smart contracts that aim at automating most processes in the banking industry, such as claims processing, compliance, and distribution of will content. The following will also be affected by the use of blockchain technologies in the future.
Typically, bank transfer from one account to another has to undergo a complicated process from intermediaries and other bank services before reaching the intended destination. This process has always been complicated, especially for cross-border payments. There has to be reconciliation between the two accounts.
Blockchain technology eliminates the need for intermediaries to approve any transactions between banks and consumers. If the stats at BitFortune.net are to be trusted, many banks are now investing in the technology as an attempt to stay relevant in a market that will potentially be drastically altered by blockchain.
Accounting is a core for every banking and financial industry. Every staff from finance executives and accountants is concerned about the accuracy, accessibility, and transparency of records. A lot of time is wasted trying to have multiple parties to confirm the consistency of the data entered, double checking all the files before they are put to further use.
Blockchain technology will change the accounting field by creating a source of information that many users can use for reference which is trusted and secure. This will also help in eliminating the cost of audits by automating the double checking and cost referencing processes.
When financial institutions shift identity management to blockchain technology, users can select how they want to identify themselves. Finance is a sensitive sector, and every detail entered must be secured from hackers and third parties.
Users will only need to register identity on the blockchain, but after that, they can re-use the selected identification for other services. This will ensure security and minimize any risks in the industry.
The banking and finance professionals must understand that blockchain technology is not meant to take away jobs. Instead, it will make work easier and save the time used for tracking and verifying data. It cannot be concluded that list of changes and improvements will occur overnight for any industry.
However, you can be assured that significant changes will come as a result of blockchain implementation, especially for small ledgers such as accounts payable and receivable. The process will then expand to larger areas such as the customer transactions, until the whole company swings into the technology.
The potential of blockchain technology is immense and is expected to grow with time. Everyone should be expected to witness an incredible and exciting era of blockchain’s extensive use.