How Blockchain is Revolutionising the Banking Industry
The banking industry has the huge potential to grow with the use of blockchain technology. Plus, there are thousands of blockchain development company in India which are offering their best services. Without a doubt, there is no one questioning the potential of blockchain to revolutionize the banking industry. People are realising the huge potential of it. However, how is blockchain going to change the banking industry over next decade?
Blockchain technology was founded in the year 2008. However, it has taken over the internet, technology and banking industry by storm.
According to Statista.com, 24% of users worldwide are familiar with blockchain technology. This number is only 41% if you count people in North America. In the year 2013, 13 different blockchain companies are valued at $365 million. By the end of 2016, its value was $1 billion.
However, the speed of development is not going to benefit blockchain development company in India. For instance, the banking industry can use the blockchain technology to make transactions faster than ever.
Moreover, 70% of banking and financial companies say that the speed of technology concerns them. In this post, we will discuss how blockchain in the current scenario is revolutionizing the bank industries.
Also read: Ways of implementing Blockchain
How Blockchain Technology Applies to Banking Industries?
In order to understand that how blockchain is going to revolutionize the banking industry, you first need to understand how it works. As a simple thing, you can consider blockchain technology as the model for processing, finalizing, and securing transactions. Nowadays, banks need to process millions of transactions per day. Which is why the banking industry is going to be the one to use this technology.
The process of the transaction in blockchain technology is really fast. Like if a person requests for a transaction using cryptocurrency. After that, they use the computer to process the transaction. After the nodes are finished, the transaction is verified using blockchain technology and gives its own unique signature and address for transferring money internationally.
Here are the two reasons why blockchain technology is going to revolutionize the banking industry in the next decade:
- Fast Transactions
- Less Expensive
Also read: Blockchain Hype
Blockchain Transactions are Fast
For instance, you want to ship oil from India to Singapore. How long it will the oil take to travel from one country to another? However, the story looks different when you ask about the paperwork as well? The answer to the question is almost a week. So the product could be shipped in one day, but it takes 7 days because of the paperwork. This the reason why banking needs blockchain technology in order to make transactions fast, easy, and secure.
Therefore, blockchain not only has the potential to save the banks of millions of dollars, but it can also speed up the transaction process for both domestic and international transactions as well. This is the reason why many banks worldwide are making an investment in blockchain technology. Banks like Bank of America is registering their blockchain patents. In addition, many banks are offering their own cryptocurrency. All these banks are investing in blockchain for a good reason. It also saves a lot of money meaning that there will be more happy customers, more efficient processes, and lower overhead.
Blockchain Technology is Less Expensive
If banking industries can spend less money, the ROI of the banking industry is one of the major concern. Especially in recent times. Here the top three reasons why banks want to invest in blockchain by raising their efficiency and lowering the costs:
- Digital Disruption
- Uncertain Regulatory Environment
- Historically Low-Interest Rates
Blockchain systems could become cheaper than the existing platforms because it removes one entire layer related to authenticity. The blockchain used the distributed ledger system, the transaction confirmation is performed by everyone on the system. This process is called consensus which reduces the need for existing intermediaries.
Moreover, the customer identification is important, detrimental or expensive if it is done wrong in the banking industry. After all, if one breaches your bank information, they will have entire access to your hard earned money. This is the reason why banks should opt for blockchain technology.
Also read: Know About Blockchain
However, it will take banks time in adopting blockchain technology before the mainstream adoption and saving millions of dollars.
Blockchain technology will take time to have the mainstream adoption in the banking industry. For instance, it took people 76 years to telephone, and smartphone took 10 years for mainstream adoption. In the coming years, you will see more banks creating their own cryptocurrency and using blockchain technology for baking transactions.
If you are looking to hire a blockchain development company in India, PixelCrayons is the best choice. They offer benefits to their clients like 100% money back guarantee, after development support, agile development methodology, and much more. Plus, they offer the best blockchain web developers and application software developers in the industry.