Knowledge Share
New Normal, Digital Transformation, Industry 4.0
Trust | Transparency | Traceability
Smart Credit and Blockchain
10 July 2021 | Blockchain, Emerging Tech, Fintech, Retail Bank, Supply Chain, Traceability
Indian banks and NBFCs provides a massive opportunity to implement blockchain technology for KYC diligence methods, evaluate lending risk, and manage clients/vendors. The emerging use of blockchain technology in financial services can transform small business lending and improve capital access for businesses across the sectors.
Opportunities for NBFCs: TRST01 Blockchain Architecture integrated platform offers consent-based data in a secure manner that is made immutable and transparent. The solution accelerates the speed and efficiency of transactions. While also catering to specific used cases in parlance to NBFCs, the entire lending lifecycle from origination to loan servicing, collections, and monetisation of the asset through securitisation.
TRST01 Services (Across the value chain): Specific across the present segment of NBFCs, Blockchain plays a massive role in identification (enabling trust), authorisation (enabling transparency), and Traceability amongst the process of lead generation, customer onboarding, underwriting, credit/loan disbursement and collection. The NBFCs or the Banking segment, in collaboration with our Blockchain as a service (SaaS) platform, can test and deploy solutions, automate back-end and middleware software applications, and make the whole process of origination until the underwriting/collection process swift, structured and transparent.
Reasons for Blockchain:
- Distributed and Sustainable: participants share a platform with secured access
- Secure and Immutable: manages the overview of a process, easily traceable from purchase to completion of the loan term
- Transparent: a comprehensive view of all the steps in the process, including the ownership
- Auditable: vigil towards the moment when delay or error occurs
- Flexibility in Lending Management: achieve onboarding of customers and quick installation without disruption
Opportunities for Small Business Lenders: The Blockchain integrated technology also implemented to facilitate the application and loan process through the Small Business Administration. The complete application process from creditworthiness to a loan disbursement significantly streamlined with a Blockchain platform approach.
TRST01 Use-Case: The Solution and the live product for the Gold Loan manage to provide a transparent and robust customer engagement process through a simple QR scan and verification of their pledge assets document through a link in a secure blockchain layer. Banks’ and NBFC’s offers Gold loan with minimum documentation in less than 15 mins. TRST01 Blockchain platform “#Gold” secures Gold loan transactions in ‘less than 15 seconds and creates ‘Trust & Transparency’ to the customer.
Advantages of using BC technology in gold-based lending: –
- Ownership: a comprehensive view of participants and their managed assets
- History: to know about the sequence of events to a particular transaction
- Encumbrances: to know more about claims/liens on a particular property/asset
Future Scope: Blockchain’s value increases when an efficient solution multiplies, i.e., when more and more players participate and stakeholders come together to cooperate on matters of industry-wide or system-level importance. Through our product/used case-specific abilities, we are hoping for new partnerships and opportunities, which are most likely to emerge from multidisciplinary banking ecosystems in India.
Prateek Bebortha , Business Analyst , TryamBhu Tech Solutions
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