We are at the cusp of a technology revolution. The country started off with something called Unified Payments Interface, based on a long existing technology of immediate payment service (IMPS), ultimately graduating to Bharat Interface for Money (BHIM). The organisation behind all these technologies, National Payments Corporation of India (NPCI), recently launched a common QR code app (BharatQR) and has in the past few weeks initiated the process for fingerprint-based payments called AadhaarPay. But, innovation is not focused only on consumers; banks are also transforming their internal processes by leveraging technology. Banking, today, is in a revolutionary mode that can restructure the workings of finance capital and governance systems. Blockchain, the technology behind Bitcoin, is increasingly gaining currency and may well bring about a second revolution for modern day banking. From bitcoin to every bit The digital ledger system called Blockchain is now finding uses across banking channels, trade finance, insurance industry, company voting and record keeping. The system works like a shared Google spreadsheet, but much more potent and secure. So, each transaction gets recorded on the spreadsheet for all in the system to see, but one can only make changes once all parties agree to augmenting it. And this is what has led to Bitcoin gaining more relevance. \u201cThe technology can help banks automate inter-organisation processes, significantly improve transparency and reset existing operational benchmarks. Several progressive organisations have already executed pilots to validate these propositions. We believe, in the coming quarters, the industry will experience greater momentum towards rolling out lab-pilots to real-life use cases,\u201d says Sanat Rao, chief business officer and global head, Finacle. While blockchain eliminates the need for a central regulator in case of banking, it also allows smart contracts to be enforced so that banks can keep track of shipments and disburse loans accordingly. For companies, it allows shareholders an open line to cast their votes from anywhere across the world as their terminal becomes a secure voting machine. That is not all. For governments, blockchain can be the new way of defining governance, as each one can store land records and titles online, eliminating instances of fraud. Also, Blockchain is just the tip of the iceberg, once combined with AI and Big Data solutions, it can open up a world of possibilities well beyond our imagination, but that may stretch out far into the future. \u201cWe are only in the initial stages of developing blockchain, data analytics and artificial intelligence would only come once we have perfected the initial design,\u201d says Raja Raman, vice president, Sapient Global Markets. Bankchaining India Although India is a bit late to the game, it is not far behind. Though the government is still far from using the technology, the research arm of Reserve Bank of India, Institute for Development and Research in Banking Technology, recently released a paper pointing that the technology was mature enough to be considered for Indian banking. The organisation even tested Blockchain, claiming that it could form the basis of RBI creating a digital currency. If that is not all, the country\u2019s largest lender SBI also became part of the Blockchain bandwagon creating a system called Bankchain in association with IBM, Microsoft, Skylark and KPMG, and 10 commercial banks. While SBI may not the be first bank in India to do so\u2013\u2013ICICI, Yes and Axis have already instituted the technology for domestic financing, intra-bank transactions and cross border remittances\u2014what makes this initiative special is that it is not developed in isolation and comes into effect with different lenders. You might also want to see this: The world in chains As well received as Blockchain may be, the technology is fraught with risks, the biggest of which comes from banks and systems themselves. More important, it is the security risks that Blockchain technologies would have to counter. While Raman believes that it has the potential to transform not just financial transactions, but governance initiatives as well, he says that kinks in terms of security and safety will have to be worked out first. While an interconnected network of system is what powers Blockchain, in isolation it can only do so much. Earlier, most banks had formed a consortium to leverage the technology, but now most of the big players like Goldman Sachs have left the consortium to develop their own systems. Although SBI has taken an initiative to tie up with 10 banks, RBI would have to step in for system to have some legitimacy and not meet the same fate as the international consortium.