Blockchain-Based Consumer Banking Solutions Redefining the Industry

Blockchain has the potential to disrupt the banking business by delivering novel services to clients at a cheaper cost, faster, and with more security. Its applications extend beyond the simple ease of transaction processing to affect areas like payments, loyalty programs, client onboarding, and so on. It also offers a safe way to store and transfer digital assets without the need for third-party middlemen.

These distinct characteristics of blockchain provide various chances to redefine consumer banking. A blockchain application in banking can transform the following processes:

• Customer onboarding and identity management

Customer onboarding is a typical and complicated activity that necessitates Know Your Customer (KYC) and Anti-money Laundering (AML) checks across several departments. Aside from being a laborious process that leads to duplicate records, client onboarding must be safe in order to protect sensitive data. As banks ride the digital wave, Fintech and non-financial industry players that offer blockchain-based banking solutions for customer onboarding are more likely to position themselves as leaders. 

• Smart contract management

One of blockchain’s primary advantages is its capacity to hold smart contracts, often known as self-executing contracts. These smart contracts comprise the rules and constraints associated with an agreement. More importantly, when an event occurs, such as reaching the expiration date or dealing with a specific strike price, they automatically enforce the built-in guidelines. 

Blockchain banking software services powered by smart contracts can assist retail banks in managing mortgages and loans at lower operational costs, thereby reducing expenses for themselves and clients. 

• Payments

Currently, performing cross-border payments with correspondent banks necessitates the use of a central counterparty that supports SWIFT transfers. As a result, transaction administrative costs rise due to manual intervention and the involvement of third-party organizations. Blockchain technology has the potential to simplify and accelerate payment transactions, resulting in faster and more accurate settlements as well as cost savings. However, in order to enable this, particularly for international payments, banks must either collaborate or construct a backbone network to sustain worldwide expenditures for banks and client fees.

• Loans, credits and mortgages

By establishing shared copies of agreements with a fully auditable trail, blockchain-based smart contracts have the potential to transform loan, credit, and mortgage administration. This simplifies the process of releasing cash by allowing for rapid payment settlement and title transfer. Through increased speed and traceability, blockchain may enhance the whole lifespan of mortgages, from origination to settlement, as well as streamline fulfilling and service procedures.

• Fraud prevention

By improving the transparency of payments, a blockchain application in banking can prevent fraud. Transactions recorded on the blockchain are immutable, which means that they cannot be deleted or modified. Furthermore, a blockchain can be permissioned, wherein the network participants are first validated and verified before they are allowed to contribute to transactions. 

• Loyalty/reward offerings

The transparency, immutability, and security of blockchain can improve traditional loyalty and reward services by removing the liability for reward points and the administrative expenses associated with operating these programs. Through blockchain, incentive points may be instantaneously updated and made available to customers for quick redemption.

• Clearing and settlement

Blockchain technology aids in the reduction of operating expenses and the facilitation of real-time transactions between financial institutions. The primary advantages are reduced latency, increased transaction visibility, and transparency. 

Conclusion

With the advent of blockchain, the banking and financial services industries are seeing considerable upheaval. Banks that want to implement digital capabilities and become true digital service providers must recognize the value that blockchain delivers. Blockchain banking software services have the potential to alter how banks handle client onboarding, loyalty programs, payments, loan and credit processing, contract administration, and much more with its immutable, transparent, secure, and distributed ledger system. 

Antier Solutions develops and delivers blockchain-powered banking platforms tailored exclusively to the banking industry. These services are intended to facilitate blockchain implementation across multiple business processes, assisting banks in lowering costs, reducing effort, and achieving near real-time processing capabilities. With these benefits, banks will be able to get more out of their digital transformation activities. 

In addition to building custom banking platforms, we provide a white label blockchain application in banking, packed with all essential features like bank accounts, payments, credit and debit cards, trading, lending, and user onboarding.

Schedule a free demo of our white label banking solution or connect with our subject matter experts to share your banking needs.