Blockchain technology is the word of order in financial institutions. Blockchain is considered an innovative technology that has made the world more transparent and efficient. It has the ability to address some of the barriers to providing accessible and usable financial access such as account opening, account usability and costs incurred for a financial institution.
Significant role in financial inclusion
Experts say that blockchain can play a significant role in accelerating financial inclusion. It can empower and transform the lives of billions. The report on global financial development describes financial inclusion as the proportion of individuals and businesses using financial services. Financial inclusion is positively correlated with economic growth. It allows the poor to improve their lives. According to research from Georgetown University, the use of this latest technology can reduce costs, reduce risks and improve financial innovation. "Blockchain technology enables financial innovators to provide specific solutions to the regional problems faced by unbanked individuals (individuals who do not have access to financial services), enabling them to develop tailor-made solutions to a complex and complex global problem. most of the unallocated are from Africa, from Asia, from Latin America and the Middle East.
The research shows that the exclusive characteristics of the blockchain allow financial institutions to customize their products and services, and therefore to promote ease of use for collections and underbanked. A good example is Coins.ph, a Filipino company, which provides users with a mobile platform, based on blockchain, to allow them to send money at a cheaper and faster price. As per sources, the blockchain has allowed Coins.ph to create an application to facilitate the transfer of funds without relying on existing banking infrastructure and to be more agile in their services at a more affordable price.
Moreover, as research, individuals do not need to go to a financial institution to open an account or deposit money. "I can open an account on my phone, thus avoiding travel costs to set up the account, I am also able to deposit money to my account through a number of third-party agents, which makes it easier to get the money in the system. "
But there are other challenges besides simply opening an account. However, through blockchain, users and institutions as a whole relax. Georgetown University states that one of the differences between the current payment infrastructure and blockchain is that the blockchain can transfer value in an almost instantaneous way. In addition, transfer fees are applied as a percentage of the transfer value rather than a fixed rate and the transfer does not require minimum payment amounts. "Blockchain payments do not have to go through the national payment system, financial institutions are able to offer more services digitally."
Blockchain enthusiasts say that new technology can transform the banking sector. The We Forum states that "the corruption scandal like the 1MDB case, which involves one of the most important financial institutions, could have been avoided with the use of blockchain technology".
The almost impenetrable Blockchain offers a solution to corruption, since no government can add or remove money from circulation. Financial institutions and the banking system as a whole can benefit greatly from the blockchain.