Blockchain and Digital Payments
Blockchain is the underlying technology that powers Bitcoin. In recent times, it has become a frontier for cybersecurity, IOT, digital ledgers, and other data technologies. Blockchain, a disruptive technology, made its big splash with cryptocurrencies invention and trading.
Blockchain technology is expected to play a major role in the future of digital payment processing solutions. The Blockchain tech, using encrypted distributed ledgers, provides secure real-time verification of transactions and eliminates the need for mediators such as correspondent banks.
There are two main areas of blockchain activity that may have implications for businesses: international payment processing services involving bank-to-bank transfers and trade finance applications (including the use of “smart contracts”). These are small, self-executing programs stored on the distributed ledger that automatically execute payments or other actions when specific conditions are met.
Blockchain technology provides a way for untrusted parties to come to agreement on the state of a database, without using a middleman. By providing a ledger that nobody administers, a blockchain could provide specific financial services — like payments, or securitization — without using a middleman, like a bank. Further, blockchain allows use of tools like “smart contracts,” which could potentially automate manual processes, from compliance and claims processing, to distributing the contents of a will.
Government of India is also focusing on IndiaChain – deemed to become the largest government-owned blockchain network across the globe. Blockchain solutions are already helping catalyze digital payment adoption throughout the country.
Reserve Bank of India, plans to introduce a digital rupee, or its own version of CBDC (Central Bank Digital Currency), in the near future on the blockchain platform.