Blockchain in the Financial Sector

There are very wide and diverse methods of payment in today’s world of high finance and keeping track of those different payment or money transfers is a complicated and costly business. Whilst of course the use of credit and debit cards did to a large extent make these transactions easier for the general public, it did also have its complications and associated expenses to the businesses which accepted them. Perhaps the main problem could be attributed to the fact that accounting records did not keep up with the more modern payment methods and so focusing them together had been somewhat of a problem.

The introduction of what is known as Blockchain could change all this, allowing businesses to more readily keep track of the diverse methods of payments being used and also make it cheaper to keep track of them. Blockchain is basically a set of accounts which can be shared among multiple viewers but its important benefit is that although many may see the accounts, no adjustments can be made and so any entry is there for all to see. This does not only allow ease of tracking but also makes all transactions fully visible which is beneficial in many ways.

Although perhaps not noticeably beneficial to an individual, Blockchain will be greatly beneficial to larger groups and those benefits should trickle down to the individuals. For instance, not only can a railway company keep track of tickets purchased but they can keep track of all tickets purchased on particular routes and particular stops along those routes. This in turn can allow the railway companies to make appropriate savings by changing timings or destinations which could potentially make tickets cheaper, or some at least.

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Blockchain and its potential are envisaged to be a leading aspect of any business in the future, especially in the fields of agriculture and medicine where many different suppliers are involved to each individual retail outlet. Keeping track of the payments to the different suppliers and being able to accurately share the costs to the consumer has been a problem for many years but the introduction of Blockchain is expected to ease these problems significantly and that too could reflect in the costs to consumers.

The financial industry though has been the first one to see the potential for Blockchain and is already looking at ways to use it to its full potential. Cross payments from one organization to another have in the past been sometimes difficult to track with accuracy however, as accounting information can be shared with Blockchain in a way that cannot be altered, opens up not only advantages for better tracking but also make the transactions far more transparent and transparency in the financial sector is still an aspect of great concern to both businesses and to governments. With well co-ordinated use of Blockchain, these and many other problems are thought to be things of the past and that will ensure that Blockchain has a significant future.

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Phani Kumar S Phani Kumar S on April 25, 2019

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