5 Indian banks That Are Rewriting The Payments Field With Blockchain
Even as the Reserve Bank of India warns them against dealing with cryptocurrencies, banks have begun adopting the underlying technology of the asset class — blockchain. Multiple Indian banks have made a foray into the blockchain space, mainly for disruption in the payments and invoice areas. Here’s a look into 5 Indian banks using blockchain today. YES Bank Yes Bank is one of the first Indian banks to adopt blockchain for invoice financing tool. This will utilise IBM’s HyperLedger Fabric to invoice purchases and the general flow of money in the bank’s systems. Bajaj Electrical and 32 other vendors have been brought on board to the platform to enable the use of next-gen invoicing. Before the implementation of the system, the process used to take up to 4 working days for various procedures such as verification, presentation, recording, and reconciliation of invoices. Now with the use of blockchain and IBM Watson Conversation, the process has been reduced from four days to almost real-time. Yes Bank also partnered with Ripple, a company looking to solve cross-border payments through the use of blockchain and digital assets. The company is the majority holder of the second largest digital asset in the world known as XRP and is set to disrupt SWIFT, the incumbent for cross-border payments. Amresh Acharya, Group President, and Head, Global Indian Banking at Yes Bank, stated, “We are glad to partner with Ripple to realize the enhanced efficiencies of blockchain for real-time cross-border payments. This partnership is a continuation of YES BANK’s ethos of using state-of-the-art technology innovation.” Axis Bank Axis Bank also established itself as a pioneer in the Indian blockchain space. The bank has initiated an inward remittance solution based on the blockchain. This project was conducted in union with RAKBank, using which it will deliver services for the retail customers of the Middle East. And for blockchain-powered remittance product, Axis Bank teamed up with Ripple. All of its remittance products using blockchain use Ripple’s technology. Industry reports also indicate that the company has also revealed that they have a positive view of blockchain in remittance services. Axis Bank top-level executive stated that corporate banking operations will see the use of blockchain before retail businesses. This is due to their differentiating factors such as speed and cost of the transactions, along with the efficiency and ease of conducting them. V Srinivasan, Deputy Managing Director, Axis Bank stated, “Remittances have been a key strategic area for us. We are excited with the potential of blockchain technology and how it could deliver in enabling real-time, affordable money transfers. We started the work with Ripple and are in active discussions with other banks on the network.” Kotak Mahindra Bank There seems to be only one company gaining ground in the India market for cross-border payments. Ripple’s name shows up once again as a technology provider to Kotak Mahindra, giving them access to their blockchain-powered xCurrent architecture. This not only reduces the costs associated with remittances but also increase the speed from half a day to 3 days to near-instant remittance. Costs are set to reduce by 10-40%, along with increased interoperability with other Ripple partners such as Axis and Yes Bank and 200 others. Deepak Sharma, chief digital officer, Kotak Mahindra Bank, shared reportedly, “We are theoretically convinced that blockchain is the way ahead. But we have to establish a practical use of the technology. As of now, the focus is on whether the technology is scalable in the near future.” IndusInd Bank IndusInd Bank also forged a partnership with Ripple to use blockchain to facilitate inward and outwards remittances in India. The result of this partnership is that IndusInd customers now have instant remittance access markets such as Brazil and China through RippleNet. The Bank plans to leverage the latest technology to build on its existing footprint in the payments business through this alliance. Blockchain technology for payments lowers both costs and transfer times for their customers. Also, by joining RippleNet, financial institutions are able to communicate information about a payment between each other and settle payments immediately. Ramesh Ganesan, Senior Executive Vice President at IndusInd Bank stated, “We plan to leverage the Ripple platform to provide an enhanced experience to our clients by delivering instant settlements and confirmations on the back of a highly secure infrastructure.” ICICI Bank ICICI Bank was the first Indian bank in India to use blockchain to exchange and authenticate remittance transaction messages and international trade documents. This was conducted in a partnership with Emirates NBD for remittance and trade finance, thus executing its first two transactions utilizing blockchain. The transactions also allowed for the instant remittance of funds from Mumbai to Dubai in real time. This was attributed to the blockchain, which equips the banks to send real-time financial messages, thus allowing remittance transaction to take place instantaneously. At last count, the bank on-boarded over 250 corporates on this platform. This has resulted in companies utilising the Bank’s custom-made blockchain platform to undertake domestic and international trade finance transactions. ICICI is also working on a blockchain-based closed-loop wallet to be used on college campuses. Beginning of the ‘blockchain in banking’ trend? According to a report by PwC India, there are two definite trends emerging in the use of blockchain. The first trend is that banks are beginning to test the uncharted waters of utilising blockchain for payments. This adds up to the banks trying to test if blockchain is enterprise ready. The second trend in the process is the complete disruption of the core of the banking systems. This includes the reimagination of central enterprise software, as seen by the adoption of the Temenos T24 banking system. The use of blockchain in payments was its original purpose, as seen by the creation of Bitcoin. However, companies such as Ripple have begun to disrupt traditional banking using blockchain, an advancement that provides the most improvement to customer satisfaction. The extended reach of blockchain might also provide an opportunity to enter the underbanked and unbanked sectors, bringing more customers to banks and a more seamless experience for payments.
Even as the Reserve Bank of India warns them against dealing with cryptocurrencies, banks have begun adopting the underlying technology of the asset class — blockchain. Multiple Indian banks have made a foray into the blockchain space, mainly for disruption in the payments and invoice areas. Here’s a look into 5 Indian banks using blockchain […]
Even as the Reserve Bank of India warns them against dealing with cryptocurrencies, banks have begun adopting the underlying technology of the asset class..
["IBM", "Infosys", "ripple"]
["Infosys", "AI", "innovation", "ML", "Scala", "Git", "RAG", "Ray", "ripple", "IBM", "disruption", "GAN", "R"]
["AI", "ML", "Ray", "RAG", "R", "Scala", "Git", "GAN", "innovation", "disruption"]
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