South Korean bank expects to reduce human errors with the use of blockchain tech

11 Dec, 2018 | Updated: 11 Dec, 2018
by Fifi Arisandi
Adoption
South Korean bank expects to reduce human errors with the use of blockchain tech

The second largest bank in South Korea utilizes blockchain technology as an effort to reduce human errors.

Many industries have acknowledged how blockchain technology can improve the efficiency of various internal processes.

Among those is the banking industry that has been reported to have embraced the technology for many purposes, such as improving cross-border payment speed and credit application verification.

As reported by The Next Web, a South Korean bank, namely Shinhan Bank is reported to have implemented the nascent technology to handle Internal Rate Swap (IRS) transactions, a process that previously were done manually by the bank staffs.

The implementation will utilize blockchain technology’s smart contracts feature to swap interest rate between multiple parties, which would allow them to hedge risk and manage debt.  

According to the bank’s spokesperson, “Prior to the blockchain-based process, there had been no standardized rules governing keeping and managing financial records, a reason why market participants had to rely on their own records which often times led to errors despite the cross-checking process requirement.”

With the implementation of blockchain for the IRS, the second largest bank in South Korea expects to reduce the cross-checking and verification needs, as well as the chance for errors, which will result in a streamlined process.

That said, further deployment is still awaiting the bank’s internal decision that confirms the stability of the system.

Moreover on how much human errors can be reduced with the blockchain technology implementation, it still remains to be seen.

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