Blockchain Technology - Banking and Finance

Block chain is a distributed database which is present on multiple computers at the same time. It is constantly increasing as new sets of recordings, or it also called as 'blocks', are added to it. Each block contains a timestamp and a link to the previous block, so they actually form a chain of blocks which contain information.The data which is stored inside a block depends on the type of block chain. Blockchain technology increases the security and speed up the exchange of information in a way that is cost effective and more transparent.

The blockchain essentially is a database about every Bitcoin transaction which usually known as "Public ledger" and this ledger is publically accessible through API's. The log contains meta data about how each each transaction took place and when. The database which is created is cryptographically secured and it also keeps everyone’s copy of the distributed blockchain is kept in sync.

Banks are eagarly waiting to take the opportunity to reduce transaction costs and the amount of paper that they process. Implementing blockchain technology in banking and finance sector would be a step to making banks increasingly profitable and valuable. 

Lets see how blockchain technology is beneficial for Banking and finance sector :

• Fraud Detection : 

Blockchain is the new technology that would reduce fraud in the financial world. Most banking systems  built on a centralized database, which are more vulnerable to cyberattack because if the hackers attack one system then they will get the full access and therefore this technology would get clear the current crimes committed online today against our financial institutions.

• Smart  Contract :

Blockchain technology provides facility of smart contracts as they facilitate storage of any kind of digital information, including computer code that can be executed once two or more parties enter their keys. When this code is programmed, contracts could be created and financial transactions executed according to the set criteria.

• Payments : 

Blockchain disruption could be highly transformative in the payments process. It would give permission to banks higher security with minimal lower costs to process payment between organizations and their clients and even between banks themselves. Blockchain would get rid of all the intermediaries in the payment processing system.