A digital platform for banking guarantees built by an Indian company is being deployed in Israel in order to help with various types of bank verifications.
Aaron Wood reports at Cointelegraph today that the Israeli bank Hapoalim is using Tata Consultancy Services’s digital bank guarantee platform to help with the “issuance, modification, termination and invocation” of transacted capital.
This is all part of a more general plan to innovate banking in order to help make these guarantees less labor-intensive.
Citing an “archaic process” traditionally used for banking guarantees, Nigel Dobson at IBM describes what’s new, first setting up the problem:
“Today, some 11,500 retailers in Australia and New Zealand rely on paper guarantees that are created through a manual workflow,” Dobson writes. “This makes issuing guarantees a tedious back-and-forth process. Paper documents are prone to forgery. Landlords need to manage and store the guarantees, usually in fireproof safes, and manually reconcile them against property leases. Banks lose sight of the document the second it’s issued. And for end customers, the process is cumbersome; each delay means they are not open for business that much longer.”
New digital processes, Dobson says, can eliminate some of these issues.
“To solve this age-old problem, there’s a transformational solution backed by Lygon 1B, a fintech consortium comprised of ANZ, Westpac, Commonwealth Bank, IBM Australia, and property management firm Scentre Group,” Dobson writes. “Working with a multidisciplinary team from IBM Services, Lygon developed a cloud-based blockchain platform that manages the end-to-end guarantee process with speed, security and transparency. The platform features a digital workflow, standardized terms and the security to resist fraud. With all functions in one place and immutable data transparent to all parties, the platform makes it easier to do business. The speed is exceptional. In the pilot project with live customer data, what used to take up to a month took less than a day — that’s a 90-95% improvement.”
Banks can now, Dobson contends “take advantage of collaborative synergy” to move the needle on how transactions get verified. Look out for this type of innovation in influencing crypto and blockchain sectors.