A blockchain-based record is open to all participants and all participants have a copy of all the data. Moreover, all transactions are recorded on a real-time basis on every copy of data.
In other words, if you are member of the network, you can see all the transactions that ever happened and continue to happen.
As a result, such record keeping increases the trust and speed of financial transactions. The technology was invented by an anonymous hacker for creating bitcoin — a digital currency that records all the transactions on such blocks (which form a chain as more and more transactions are carried out.)
While blockchain-based products, such as bitcoin, are open to everyone, Infosys’ solution is open only to the banks that participate in the program.
It has launched a pilot “trade finance network” for banks to trial the solution. 11 banks have partnered with Infosys Finacle to be on the network, it said.
The network will be used for storing data where trust and speed are extremely crucial.
These products include bill collection, letters of credit, open account for trade, consumer to consumer transactions, business to consumer transactions, PO financing and invoice financing.
“The solution allows for a single source of truth and increases trust, with message and document sharing done at the same time to all parties involved in a transaction 0 it provides a shared picture of granular trades and enables efficient risk management, with flow of merchandise and information being visible to each party at the same time,” Infosys said.
It will also increase the speed and efficiency of the involved transactions, said the company.
“It provides higher automation, increases transparency and enables real-time availability of data, enabling better decision making and opening up new business avenues for both banks and corporates o Banks, buyers and sellers continue to maintain a direct relationship and can engage directly with each other on digital channels.”
Sanat Rao, Chief Business Officer, Infosys Finacle, said, “Typically, trade finance processes involve complex documentary processes, high transaction costs, high settlement times and low authenticity rates with physical documents. As a result, a bank’s business customer is straddled with delays, high costs and risks. Besides, most small business customers worldwide experience challenges accessing trade credit, with a significant majority of applications for trade finance unable to go through.”
The solution “holds much promise to help banks ease pressing concerns internally, as well as those faced by their business customers, with advantages increasing exponentially with more banks collaborating. Infosys Finacle is committed to helping our customers through this journey to realize the path breaking benefits of blockchain technology,” he added.
Infosys Finacle is the name of the software solution that the company has created for banks.
It is one of the most widely used core banking solutions, partly due to its cost-efficient nature.
It is deployed on banks across 94 countries and serves over 848 million customers – estimated to be nearly 16.5 percent of the world’s adult banked population, according to the company.