Blockchain technology streamlines payment systems, reducing the operational costs, human blunder, and falsification. It also helps banks get rid of all intermediaries in the payment processing system to lower the costs of process payments between clients and banks

Fremont, CA: Blockchain, primarily a distributed ledger technology (DLT), is a disruptive application that has a tremendous potential to transform the workings of the financial sector in recent years. However, the banking sector has always been open about adopting new technology to turn conventional banking practices to convenient banking practices.

Let us look at how blockchain technology is transforming the financial services sector:

Banking space has been facing several issues regarding the recoverability of loans granted by the banks. Using Blockchain technology can make it possible for the transactions to be recorded in a block. Generating the blocks of every transaction will enable banks to trace the diversion of the loaned funds.

It is essential for the banks as well as other financial institutions to create a database containing all the information of the customers, including their identity proof in order to avoid money laundering or other forms of fraud. Blockchain technology can help banks conquer the problem of establishing identity by providing cryptographic protection that ensures the involvement of all parties to the transactions.

The domestic payments generally take minutes to hours to complete, but it takes several days to complete the transaction for cross-border payments. Besides, inadequate infrastructure creates security concerns while making an international transfer. Hence, these payments are prone to cyber-attacks that can interrupt transmission. Blockchain technology streamlines payment systems, reducing the operational costs, human blunder, and falsification. It also helps banks get rid of all intermediaries in the payment processing system to lower the costs of process payments between clients and banks.

See also: Top Blockchain Technology Solution Companies