SBS Bank in New Zealand seems to be considering using blockchain technology as a way to provide an improved user experience for their clients.
While some financial institutions are vehemently denying their customers’ interest in cryptocurrencies, New Zealand’s SBS Bank is taking a more pro-active approach.
According to The Southland Times, virtual currencies and blockchain technology were two of the topics discussed at the bank’s recent annual meeting. While the former still has the power to elicit skepticism, the latter is definitely a keen point of interest. The bank’s group chief executive, Shaun Drylie, explained:
We think, and the common consensus is, that it has real merit. Cryptocurrencies, we’re not too sure, and if you look at the volatility of cryptocurrencies that would suggest the market is not too sure as well.
However, this does not mean that there won’t be a possible place for cryptocurrencies in the bank’s future. Drylie added:
We’re keeping a close eye on it, but it’s very hard to pick where it’s going to go long term.
BANKING FOR ALL
Exploring the uses of blockchain technology is part of the institution’s plan to make banking more efficient for its existing clientele and more inclusive for its potential customers. They hope to provide a comprehensive banking experience to those clients who have limited access to their physical branches.
Financial inclusivity is a popular term when discussing the benefits of blockchain. This could be in the form of allowing the unbanked population, or those with restricted access to economic assistance, to easily get credit or apply for a loan.
All of the applicant’s information could be stored and easily accessed via the distributed ledger, making the reams of paper seemingly synonymous with loan applications a thing of the past. With SBS seeing an 11 percent increase in loan approvals, this could be where blockchain could make a difference.
NO STRANGER TO BLOCKCHAIN
This is not the first bank in the country that has turned to blockchain technology. The Australia and New Zealand Banking Group (ANZ) and IBM have previously collaborated to create a more systematic and efficient solution to insurance reconciliation processes. The financial institution also used blockchain to digitize their previously paper-based bank guarantee process.
However, interest may soon turn more to virtual currencies with the possible introduction of Bitcoin ETFs. Major player Cboe Global Markets has filed an application with The US Securities and Exchange Commission (SEC) for approval thereof. Bitcoin futures trading, which began late last year, has also seen growth since it launched.
Do you think that more banks will turn to blockchain technology to replace their paper-based systems? Let us know in the comments below!