How Can Blockchain Technology Transform The Digital Finance Sector In India – Explains Ashwani Kumar, VP Technology, Coforge
Blockchain Technology Ashwani Kumar feels a great transformation is approaching, not only in the finance world but also in other major industries because of blockchain technology powering various platforms to conduct services more securely and fast with a minimum room for fraudulent activities..
In this digital era, a vast proportion of businesses are thriving online. The digital space is the new marketplace to showcase your products and services as well as to buy the same. The finance sector has followed suit. Many banks and other financial institutions have enabled online banking to lend its customers the convenience of banking irrespective of place and time. Following the modern technologies closely, Ashwani Kumar, Vice President Enterprise Architecture at Coforge, shares his valuable experience to shed some light on how blockchain technology is capable of transforming the digital finance sector in India.
Blockchain technology has certain inherent characteristics which work in its favour to be used in the financial realm. This includes the decentralised nature of the technology as well as the security aspect of it. Both these factors are paramount to fulfilling a successful and trustworthy transaction between any two stakeholders. Currently, banks are the authority as every transaction has to go through their system incurring a transaction or processing fee which the customers like us have to bear. In addition to that, there are chances of human error or fraud which has happened multiple times across the globe. However, blockchain technology differentiates itself from its very foundation by operating on a DLT (Distributed Ledger Technology) leading to transparent and anonymous transactions. The information of the transactions are stored in blocks, hence the name. This piece of information forms the chain which can’t be deleted or edited. The chances of hackers tinkering with this technology are reduced dramatically.
Also read: Discovering The Future Possibilities Of Cryptocurrency In Metaverse.
A great initiative by 15 Indian Banks gave birth to a company called IBBIC (Indian Banks’ Blockchain Infrastructure Co Pvt Ltd) recently. It involves the RBI as a regulatory body as well and has given a green signal to this unique venture. This company will develop systems to process inland letters of credit. In essence, the major banks in India have realised how useful this technology could prove to be and has made a prudent decision to get acquainted with it as soon as possible. The banks in this company includes HDFC Bank, ICICI Bank, Bank of Baroda, State Bank of India, RBL Bank, Standard Chartered, Axis Bank, IDFC First Bank, Canara Bank, Federal Bank, South Indian Bank, IndusInd Bank, Kotak Mahindra Bank, Yes Bank and Indian Bank. Many of these are already using the platforms like Ethereum and Ripple to develop new services.
The prominent IT companies in India that are active in the development of blockchain technology includes TCS, Infosys, Capgemini, Accenture, Hyperlink InfoSystem, WillowTree Apps, Zensar Technnologies, etc. This also presents unique employment opportunities in this field. Some job profiles in this sector could look something like Blockchain UX Designer, Solution Architect, Quality Design, Project Manager, Legal Consultant among others. This one technology could unlock endless avenues in times to come.
Banks and governments around the world realising the advantages and infinite possibilities of this technology are slowly but surely, collaborating to include some form of this technology in their services. Inculcating blockchain technology in the financial industry would bring down the processing time and fees significantly. Additionally, the overall efficiency of the entire system would go up by offering the people a more secure and decentralised way to perform transactions. The chances of human error and fraud would be minimised, if not eliminated completely.
From the user’s perspective, the need for identity validations could be eliminated. The financial sector in India, along with other sectors, relies heavily on KYC procedures. While it has become fairly normal these days, still a large chunk of the population are not enrolled in the process. But with the adoption of blockchain technology-powered banking, the need for the identity of a person is a bare minimum. One could sufficiently transact just through the IDs generated on the blockchain-powered platforms. The proof of transaction between any two IDs will be present across thousands of computers globally to keep track.
An industry expert who has been witnessing the developments in this field closely over the last few years, Ashwani Kumar feels a great transformation is approaching, not only in the finance world but also in other major industries because of blockchain technology powering various platforms to conduct services more securely and fast with a minimum room for fraudulent activities. The overall efficiencies of various sectors could be greatly enhanced. While the usage of Cryptocurrencies is not regulated at the moment, the blockchain technology has only received traction on the back of the crypto boom. Such salient features of the blockchain technology has also kept the investors interested. Don’t be surprised if you witness an exponential rise in the adoption and application of this technology in every sphere of our lives