Infosys subsidiary EdgeVerve Systems today said it has carried out a pilot for using blockchain network for international remittances and trade finance with ICICI Bank and Middle East-based Emirates NBD.
Use of blockchain technology simplifies the process and makes it almost instant -- to only a few minutes. This is in contrast to the current process which involves a complex and lengthy paper trail that requires international shipping and courier.
"Both Emirates NBD and ICICI Bank run Finacle solutions suite and have leveraged the blockchain framework to route business transaction between the two entities for remittances and trade finance business," a statement said.
The network was successfully piloted on the UAE-India remittance corridor, one of the busiest corridors for both banks, it added.
According to the World Bank, this corridor is the largest receiver of remittances with a share of close to 70 Billion USD out of the USD 580 billion world over.
With this, Emirates NBD became the first bank in UAE and ICICI Bank, the first bank in India, to pilot a blockchain-based network for financial services.
"The exercise was started eight weeks ago and additional use cases are being explored for the pilot. Both financial institutions have started the process towards a network consortium for further participation by interested member banks to expand the transaction network," it said.
This framework is a permissioned asset-agnostic ledger, designed specifically for the banking sector.
Blockchain-based applications built on this framework can deliver enhanced automation across inter-organisational processes, transactional security and accuracy at a significantly lower cost.
With the blockchain network in place, both banks expect automation of inter-bank processes through smart contracts, secure digital exchange of documents and real-time monitoring of positions through integrated dashboards.
"Consequently, this will lead to significant costs savings for the business," it said.
"Blockchain technology offers unprecedented opportunities to transform banking as we know it. Like any innovative technology, the usage of blockchain-based applications will gradually increase from early adopters to others who will join based on proven and tangible benefits," Infosys CEO and MD Vishal Sikka said.
With this pilot, Infosys is clearly a step closer to see mainstream adoption of blockchain-based applications, he added.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)