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Blockchain: Is it the next big thing in the banking and insurance sector?

By Noah D'Mello Jun 8th 2016

The hype around blockchain is slowly and steadily increasing, and so is its deployment in other financial sector. Here’s what banking and insurance officials have to say about this disruptive technology in a global survey by Pegasystems, Cognizant, and Marketforce.

  • Blockchain: Is it the next big thing in the banking and insurance sector?

    Blockchain: Is it the next big thing in the banking and insurance sector?

    According to a recent survey including 500 global banking and insurance officials by Pegasystems, Cognizant, and Marketforce, blockchain is touted to be the most significant technological innovation since the Internet. But the divide between those ready for its rise and those who might be left behind is fairly significant.

  • A major disruptor in the financial services chain

    A major disruptor in the financial services chain

    Once this distributed ledger technology becomes mainstream, almost all aspects of the financial services chain will be impacted. But in comparison with front-end retail, back-end clearing and settlement will be more affected.

  • But do we really understand blockchain?

    But do we really understand blockchain?

    Blockchain is still distant to some. Respondents confessed they were unaware if their organizations were conducting research (46 per cent), formed a working group (69 per cent), formulated a strategy (83 per cent), were collaborating (80 per cent) or had dedicated teams working on blockchain (84 per cent).

  • Will it be bigger than the World Wide Web?

    Will it be bigger than the World Wide Web?

    Even though almost a third of the respondents who are aware of this technology feel that it cannot get bigger than the Internet, this feeling might change significantly considering that this technology is still in blooming.

  • Still a long way to go

    Still a long way to go

    Following the examples of these few in the industry, 31 per cent of the respondents are forming working groups, 20 per cent are partnering with a fintech specialist, while 54 per cent are saying their organization is researching the potential impact of blockchain.

  • Filling up the blockchain wallet

    Filling up the blockchain wallet

    Blockchain eliminates the need for a third party intervention. Hence blockchain wallets, where consumers can hold most of their financial assets on the blockchain, could become a threat for retail banks. Millennials have already shown keen interest in P2P models, implying that blockchain wallets could be a possibility.

  • Is this the end of banking as we know it?

    Is this the end of banking as we know it?

    With the above figures, the banking sector has to wait and watch if blockchain will be a reason for the demise of traditional modes of banking.

  • Insuring a connected future

    Insuring a connected future

    Insurers have always found claims to be one of the most difficult part of insurance. This process may very well benefit from IoT, blockchain, and smart contracts. For example, drawing on data from IoT to validate a claim could autotrigger claim filing, which is then promptly settled via a smart contract on the blockchain.

  • Playing it safe

    Playing it safe

    In a world where no one is safe from cyber attacks and hackers, blockchain could just be the saviour for every individual whose personal data is placed in centralized servers. Consumers are thus likely to welcome a technology that would no longer leave them vulnerable to such attacks.

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