Blockchain Financial Service Use-Cases | OnGraph

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• Welcome In OnGraph Technology

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Blockchain Financial Service Use-Cases

• Financial Services Industry embracing distributed
  ledger technology and actively advocating its
  adoption every day. And why not? Blockchain has
  shown significant potential, thus the financial
  institutions considering blockchain that could
  help them for considerable savings in
  infrastructure, transaction and administrative
  costs. Lets explore What can Blockchain
  Technology do in Financial Service?
• Blockchains potential is abundance. Its an
  ability to store data in a ledger, with extra
  security and decentralization nature denotes
  limitless blockchain application. You get an
  insight of blockchain financial services
  use-case, here are several examples of blockchain
  application in cross-industries

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• Financial services are the economic services
  provided by the finance industry, which
  encompasses a broad range of businesses that
  manage money, including credit unions, banks,
  credit card companies, insurance companies,
  accountancy companies, consumer-finance
  companies, stock brokerages, investment funds,
  individual managers and some government-sponsored
  enterprises. This is how Wikipedia described
  Financial-Services.
• Adoption of blockchain development services will
  impact almost every area of the financial
  industry. Blockchain is assumed to provide every
  party in the network access to the same source
  of truth. However, it is private and permission
  blockchains, which is where the future of
  technology lies. In this series we describe five
  blockchain technology use-case in financial
  services

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• 1. Improve Online Identity Management When
  identity management is moved to blockchain, users
  will be allowed to define how they would identify
  themselves and with whom their identity has
  partaken. However, users will still require to
  register their identity on the network developed
  using blockchain, but once its done, a new
  registration not required for every service
  provider every time if service providers are also
  connected to the same network. Once is enough.
• Challenges Blockchain is quite a new technology
  and very few people have expertise in it and
  providing blockchain app development and
  consulting. As they are still embracing
  blockchain to know its full potential, thus
  identification options are still limited.
  Additionally, standards for identity on
  blockchain are not yet set and best practices are
  still being developed. However, if identity
  management jumped on blockchain, users must be
  aware of minimizing any private information that
  they dont want to divulge.

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• 2. Execute Smart Contracts Blockchain cuts out
  any middlemen and smart contracts foster
  trustworthiness between parties. For instance,
  Deloitte developed a PoC for a life term
  insurance product to record in a blockchain smart
  contract. Smart Contract based this project aims
  to define a payout beforehand in the insurance
  policy clearly.
• Challenges Blockchain is secure, so experts in
  domain consider smart contracts as a safer
  alternative to traditional contract law. Though
  maturity of the blockchain technology is still an
  issue, smart contracts are finding their place
  and they are here to stay.

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• 3. Increase the Usage of Loyalty Rewards Loyalty
  and rewards program are companies strategic
  investment. The 2016 Bond Loyalty Report study on
  North American loyalty rewards revealed the low
  success rate for loyalty rewards programs.
  Customer loyalty programs are not apprehending
  their full potential since it struggles with less
  client retention, redemption rates, time delays,
  and high costs. Thats where blockchain comes in.
  Giants in technology believe the issues can be
  fixed by using Blockchain where the innovative
  technology enables to integrate all of the
  programs into an interlinked network. The
  distributed ledger technology believed to offer
  new opportunities to manage transactions and
  maintain records, essential for integrating
  rewards programs.
• Challenges By linking rewards programs,
  blockchain is believed to solve many issues.
  However, the concern is there could also have
  limitations. For instance, the introduction of
  Blockchain platforms for loyalty program
  interlinking adds transaction layer for
  consumers, merchants, and program operators,
  which would likely call for a per transaction
  cost. A danger of currency devaluation is also a
  point of concern as it is essential points of
  trading in an open marketplace.

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• 4. Speed Up And Simplify Domestic and
  Cross-Border Payments Currently, international
  transactions take days, if not weeks, to be
  completed. To overcome the current structural
  weaknesses, adoption of blockchain has increased
  to offer near-instant cross-border payments.
  Blockchain to be said, reduce the settlement
  time and lower the cost of completing global
  payments for businesses and consumers. The
  ledger-based system and decentralized blockchain
  technology effectively removes the intermediary
  banks and also provides guaranteed, real-time
  transactions across borders.
• Challenges Even with the comprehensive benefits,
  there are some difficulties in adopting
  Blockchain in cross-border payments. The
  Financial Crimes Enforcement Network in the year
  2015 charged Ripple with a US700,000 fine for
  its non-compliance with the KYC and AML laws.
  Banks and Fintech need to improve and implement
  KYC and AML into the system for a secure,
  transparent yet immutable transactions records.

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• 5. Digitize and Automate Of Stocks Trade
  Processes Buying and selling stocks and shares
  has always meant many go-betweens, including
  brokers and the stock exchange itself. A
  blockchain that enables every party a say in
  the validation of a transaction will create a
  decentralized and secure ledger which speed up
  the settlement process, ensures greater trade
  accuracy, and simultaneously escape some of the
  middlemen (such as brokers) while changing the
  role of others (such as those determining share
  price).
• Challenges However, increased transaction
  security and reduced risk of manipulation
  potentially attract to regulators, blockchain can
  also give growth to severe legal and regulatory
  challenges. The financial market ecosystem is
  currently uncertain that blockchain will live up
  to its promises. Maintaining security standards
  across a decentralized database and concern
  around scalability are challenges tech giants are
  struggling with.

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• 6. Improved KYC Experience The current KYC
  process took days and even weeks to satisfy the
  requirements from regulators. Blockchain with its
  distributed ledger enables digital identity
  improvements that help financial institutions
  meet the ever-changing KYC requirements. It
  further also reduce the costs associated with
  implementing a robust KYC program. The shared and
  immutable ledger of blockchain allows for
  unaltered transaction history that diminishes
  financial crimes and compliance violations in the
  long term.
• Challenges The KYC space is an area of enormous
  risk and hence investment. Blockchains are being
  investigated as solutions of this challenge by
  banks as well as fintech to tap into the
  comprehensive authentication process.

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