Blockchain technology is catching up with the rest of the world. Slowly, but surely, it is becoming a part and parcel of institutions both financial and otherwise around the world. But how is it catching up closer to home in India? This article will examine the state of blockchain technology in India.
RBI takes the initiative: The Reserve Bank of India has successfully tested blockchain technology for trade application. The evaluation was carried out in partnership with domestic banks and other financial institutions.
The adoption of blockchain technology among stock exchanges and trade platforms is increasing. The potential of blockchain technology to automate trade settlements and transactions can prove to be a huge cost saver for financial institutions.
Successful exploration of blockchain technology by the country’s central bank will also help the growing Indian Bitcoin community. In recent times, the country has seen a dramatic increase in Bitcoin adoption and the government’s openness to the technology can translate to a lenient regulatory view towards the cryptocurrencies.
Baby steps for a giant venture
However, it is difficult in keeping up with technology and India’s financial sector knows it too well. 56% of companies interview by PwC said that though blockchain is a part of their innovation strategy, many are yet to implement it. The most common use, according to the survey, are in the fund’s transfer, digital identity and payments infrastructure.
Banks in India have begun using blockchain in their daily transactions. But such instances are far and few in between. The main attraction for adoption is that it eliminates multiple processes which save both time and cost. The main detraction only a handful of financial institutions understand what blockchain really is.
With The Reserve Bank of India’s own blockchain forays, a new precedent will be set for the banking sector in India with increased awareness of the many benefits of the technology. A fair understanding of the technology will lead to a wider adoption of blockchain technology.
The real beneficiaries of blockchain
As enterprises all over the world become aware of the many benefits of blockchain, it is the Indian public-sector that stands to gain the most from blockchain technology as it is a disruptive force changing the very dynamics how traditional processes are done across industries- from financial transactions to insurance and more.
Blockchain technology eliminates cyber fraud to a large extent, a reason why the financial sector has been the early adopter of the technology as of late. The key-high security attributes are cryptographics for the hardware, tamper-proof cards for the management and malware protection for the database.
According to the global research firm MarketsandMarkets, the Blockchain market is estimated to grow from $210.2 million in 2016 to $2.31 billion by 2021. ‘The Banking, Financial Services, and Insurance (BFSI) sector is expected to dominate the market with the largest share, as the need for banking and financial transactions have evolved from a traditional payments systems to be seamlessly integrated into new systems,’ it added.
The growth prospect of blockchain technology is what makes it a lucrative deal not just to financial institutions but also state governments of the world.
A governments tryst with technology
The flagship initiative of the State of Andhra Pradesh, Fintech Valley Vizag, aims to bring together industry, academia and investors alike to innovate, co-create and build the fintech ecosystem by making Vishakapatnam the fintech epicenter of the world. Similar initiatives by world governments around the world are aimed at creating employment opportunities in by aiming to tap into emerging technologies. As such they are exploring various avenues with which they can fully tap into the phenomenon of blockchain technology.
The onus will ultimately fall on the execution of the initiative which will ultimately eclipse the methods adopted by other state agencies around the world. This will ultimately decide the success rate of initiatives like Fintech Valley
Fintech Valley Vizag is hosting the Blockchain Business Conference in Vizag , the heart of India’s Fintech capital of Andhra Pradesh, The event will bring you an exclusive group of leading FSI executives, regulators, entrepreneurs and academics from around the globe exploring how blockchain technology will impact the financial services industry.
It is taking place on 9th – 10th Oct 2017 at the Novotel Hotel in Vizag, India.
For sponsorship and speaking opportunities, register here.