Banks may not be too interested in adopting digital currencies like Bitcoin as it hurts their business directly, but they are leaving no stone unturned to adopt the technology behind these digital platforms. Although global financial chains are leading the revolution setting up data centres across the world, ICICI, on Wednesday, became part of a select group to have executed a blockchain transaction. It became the first bank in the country to have used the process to execute transactions in international trade finance and remittances in partnership with Emirates NDB.
Blockchain is a digital ledger which keeps real-time record of each and every transaction and is shared among a distributed network of computers, more like a shared spreadsheet. So, a block of data has digital records which all participants can see, but can only be altered by a majority. While the technology in this case, was used to authenticate remittance transaction documents related to purchase order, invoice and insurance, for banks it can eliminate the need of a clearing house increasing the speed of transactions. But the uses of the technology are not just limited to banking, it can also help the insurance industry in fast processing of claims and weeding out cases of insurance fraud. ICICI may be the first Indian bank to use blockchain, with the technology being used by governments for land records and companies for voting rights, one can soon expect India to join the ledger revolution.