India’s second biggest private bank by assets, ICICI, is showing plenty of interest in the development of blockchain applications, according to the banking institution’s managing director and chief executive, Chanda Kochhar.
In an interview with the Huffington Post, Kochhar states that the bank is prepared for a technological revolution bought on by innovations like the blockchain. While the narrative is increasingly seeing Fintech as the banking industry’s biggest threat and disruptor, the chief executive confirms that her bank is ‘constantly looking’ at blockchain technology.
Furthermore, she opined that banks ought to keep tabs on financial innovations beyond the banking sector, stating:
I would never say banks should never get paranoid about these innovations that take place outside the banking system. But banks can also view these as possible innovations that the banks can themselves offer to customers and actually build even stronger, longer term relationships with them.
The comments come in the weeks after ICICI announced a successful pilot of transactions executed over a blockchain.
Developed in partnership with Emirates NBD, the Middle East’s biggest bank, a custom-made distributed ledger platform was put to use. The first transaction saw a remittance funds transfer between an ICICI bank branch in Mumbai to an Emirates NBD branch in Dubai, resulting in a successful real-time funds transfer. A second pilot saw a trade finance transaction wherein the participants in the chain – the bank, importer and exporter, gained access to data and updates of a shredded steel melting scrap import in Mumbai from a Dubai-based supplier.
ICICI isn’t the only major Indian bank to explore and experiment with blockchain pilot transactions. Axis Bank and Kotak Mahindra, two other private financial institutions revealed their own blockchain-based developments as solutions for multiple sectors of the financial industry.
Kotak Mahindra’s chief digital officer Deepak Sharma said of bitcoin’s underlying technology:
We are theoretically convinced that blockchain is the way ahead. But we have to establish a practical use of the technology. As of now, the focus is on whether the technology is scalable in the near future.
India’s posture as a leading technological services provider means that blockchain development in the country was an inevitability, even beyond the realm of the financial industry. For instance, Indian IT services firm Tata Consultancy Services, the biggest in the country, is developing over a “100 blockchain projects” for its clients around the world, according to its chief executive.
Furthermore, VISA is investing heavily in blockchain development with a new technology center in Bangalore, the IT capital of the country. The worlds’ largest payments network aims to hire up to 1,000 engineers for its research lab by the end of 2016. The Fintech-focused technology center will work in tandem with existing research labs in Singapore and the United States to develop distributed ledger solutions that could have a profound impact on the traditional payments industry.
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