The adoption of blockchain by India’s banks could help avert frauds such as the one at Punjab National Bank
Benefits of technology:
1.Disaggregated and transparent nature of the technology
2.updates information across all users simultaneously
3.would have ensured that various officials would have instantly been alerted to the creation of the letters of undertaking (LoUs), according to bankers and blockchain specialists.
4.Using blockchain, all parties on the chain will be immediately notified about a transaction.”
5.Blockchains are immutable and distributed ledgers, which means that anything recorded on them cannot be changed or deleted, and is instantly uploaded to all users on that blockchain.
6. blockchain is an ideal technology to ensure proof of integrity to the data and reduce incidents of fraud.”
What is Blockchain?
Blockchain, a distributed ledger technology originally developed as an accounting system for the cryptocurrency Bitcoin, is being researched across the banking and financial services industries for the potential benefits it may offer in an increasingly digitised business environment.
Central banks including the U.S. Federal Reserve and the Reserve Bank of India have been examining the technology to understand the regulatory challenges it may pose.
Experimental basis:Implementation at SBI
SBI was convinced of blockchain’s utility, especially its potential to improve internal fraud monitoring, and had already implemented it in its reconciliation systems and in several cross-country payment gateways
. “In blockchain, from the source system it will try to match the transactions, so one can immediately verify any transaction using blockchain.”