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The second largest bank in South Korea uses blockchain technology as an attempt to reduce human errors.
Many industries have recognized how blockchain technology can improve the efficiency of various internal processes.
Among these is the banking sector that has been reported to have embraced technology for many purposes, such as improving the speed of cross-border payments and verifying credit demand.
As reported by The Next Web, a South Korean bank, or Shinhan Bank, would implement the nascent technology to manage Internal Rate Swap (IRS) transactions, a process that had previously been performed manually by bank personnel.
The implementation will use the function of smart contracts of the blockchain technology to exchange the interest rate between several parties, which would allow them to hedge the risk and manage the debt.
According to the bank's spokesperson, "Before the blockchain-based process, there were no standardized rules for maintaining and managing financial records, one reason that market participants had to rely on their own records that often caused errors despite cross-over verification of process requirements. "
With the implementation of the blockchain for the IRS, the second bank of South Korea plans to reduce the needs for cross checking and verification, as well as the possibility of errors, which will result in a simplified process.
Having said this, further implementation is still awaiting the internal decision of the bank confirming the stability of the system.
Moreover, on how much human errors can be reduced with the implementation of blockchain technology, it remains to be seen.
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