Skip to main content

How Banks Can Use Blockchain | Benefits Of Blockchain Technology In Banking


Blockchain technology for banking entered public lexicon alongside the rise of bitcoin, the controversial, yet revolutionary, digital currency. while banks and other financial institutions didn’t immediately jump on the open-ledger train, recent developments have reinstated the technology as a way to solve some of the financial industry’s most pressing pain points.

Today, some of the biggest names in banking and finance are well underway with embracing blockchain technology.

  • JP Morgan Chase: The finance corporation has spun off a division dedicated solely to blockchain R&D. Quorum, as it’s named, stands to be JP Morgan Chase’s proprietary distributed ledger handling a range of transaction-recording services, including smart contracting and share trading.
  • Goldman Sachs: Goldman Sachs’ Circle project aims to explore blockchain technology and digital currency distribution. Its stated goal is to decrease the current volatility and controversy around cryptocurrency, as well as set up a completely digital blockchain-crypto trading branch.
  • Bank of America: One of the U.S.’ largest banks is in the works creating a single, blockchain-centered network to house banking records as well as automatically authenticate business and personal data. Bank of America’s data platform emphasizes permissioned blockchain, meaning only authorized personnel can access the ledger, as well as have their ledger entries recorded.


The industry’s renewed excitement in blockchain and financial institutions revolves around the technology’s key benefits.


The financial sector is notoriously hack-prone. Its attack surfaces are broad, namely due to proprietary banks managing centralized systems where a single point of failure can trigger exposures of the whole.

With blockchain’s distributed network, though, banks eliminate those single points of failure. Every transaction recorded in a blockchain ledger undergoes a complicated set of encryptions interconnected with the next. The result is an unalterable series of coded data “blocks,” each dependent on the rest in the ledger’s serial. It presents one of the best cyber-defenses against hacks and fraud in today’s IT ecosystem.


Blockchain can manage, approve and log any transaction instantaneously. This technology directly contrasts today’s often manual authentification, verification and data-sharing finance workflows banking and finance professions still rely upon to conduct services.


At its core, blockchain is a digital recording system. It offers unprecedented visibility into the entire lifespan of a transaction or value exchange within a bank’s operations, plus reduces the need for expensive and time-consuming third-party verifications along a payment process or funds transfer.


Together, a hard-to breach, decentralized data system streamlining transactions reduces many of the top security concerns for banks. Error and fraud rates drop while administrative costs decrease, while also near-eliminating the need for redundant storage of customers’ sensitive financial data.


Together, blockchain and banking offer one of the most exciting commercial frontiers of the 21st century. Already, financial institutions use decentralized data ledgers for several key functions.


The average KYC request today takes between 30 and 50 days to review. That extensive timeline is mainly due to the number of players involved in the KYC verification process, which includes independent request reviews from third-party vendors and even other banking institutions, plus results in the duplication of user account data.

Financial institutions using blockchain radically transform this slow, redundant process. Instead of every bank and third-party vendor maintaining siloed customer data portals, and requiring data duplication with each request, a blockchain system lets authorized users access the same data system. It expedites verifications, netting nearly $160 million in KYC cost savings annually.


A globalized marketplace calls for stronger, smoother management of digital exchanges and money conversions. In fewer places is this need more apparent than with international real-time gross settlement processes, where separate banking institutions must corroborate to execute a funds transfer or conversion in a timely yet secure manner.

Blockchain inherently simplifies this modern remittance function. Indeed, blockchain’s unique design allows it to handle instant, yet safe, financial transactions around the globe. Plus, with its near-untamperable ledger, blockchain also significantly reduces the risk for chargebacks and payment disputes and doesn’t carry the fees associated with cross-border remittance.


Smart contracting requires technology with integrated bank-to-bank fund transfer abilities, contract verification safeguards and — most importantly — automated contract enforcement capabilities. Oh, and banks must be able to execute these tasks expediently, without redundant manual oversight.

Blockchain introduces a platform that can handle such self-initiating digital contract procedures. Using preset codes, your blockchain system can perform these essential operations only under specific conditions, triggering downstream information sharing or contract performances obligations related to:

  • Rights, patents and ownership
  • Wagers
  • Escrows
  • And more

With smart contract blockchain, core pieces of a contract are also visible, irreversible and indisputable. Every party involved in the process remains on the same page regarding the details of a transaction and why the provider is now upholding specific obligations.


Loan syndication activities, in particular, benefit from blockchain. Already, banks see dramatic improvements in timelines for transferring approved sums to lendees. For example, today’s syndicated loan will take around 19 days for all participating banks to clear and approve. For more complicated loan processes — such as car and mortgage loan transfers or early loan repayments — that process can be even longer.

With blockchain, loan activities are quicker, safer and traceable, again reducing administrative costs, third-party approvals, data duplication and chances for manual error


Get Blockchain for Your Bank With Aegona

Join today’s most elite financial institutions by integrating blockchain technology into your bank’s operations — without the headaches or hurdles of going at it alone.

Let’s discuss your project ?

Take 30 seconds to fill out our form so that we can learn more about you and your project - leave us a message via:

Email: [email protected]

Phone: (+84) 28 71092939    |   Hotline: (+84) 933 848989


FanpageAegona Ltd

Address: Floor 4th QTSC Building 9, Quang Trung Software City, District 12, Ho Chi Minh City, Viet Nam

related post


Learn what Umbraco CMS is, why it's essential, and get an overview of our comprehensive guide to hiring Umbraco developers.


Are you running a small business and spending too much time calculating payroll and timekeeping? Errors in salary calculation always worry you?

How to Integrate ChatGPT with Your Existing Apps and Systems

In this article, we'll explore how you can integrate ChatGPT into your own application or system, along with some sample code snippets to get you started.

Top-Rated iOS & Android Mobile App Developments in Vietnam

If you wanna find a iOS Android mobile app development company with reasonable costs. Let's explore more details with Aegona in the following article.


In the era of Industry 4.0, where automation and optimization are dominating all industries, manufacturing enterprises are forced to adapt and innovate to survive and develop. The application of manufacturing management software (MPS software) is the key to helping businesses increase operational efficiency, optimize profits, and take the lead in the market.


Alfresco, a leading open-source platform, empowers companies to build robust and scalable Enterprise Content Management (ECM) systems. Here's how your company can leverage Alfresco to deploy a powerful ECM system.

Focus User First: A Guide to Human-Centric Software Development 2024

Learn how human-centric software development prioritizes user needs for a more intuitive, user-friendly, and successful software experience. Discover how Aegona leverages this approach to craft exceptional software solutions.

amazon event about ai 2024

Explore the power of Generative AI in the cloud with Amazon Bedrock and LangChain Lab. Learn about applications, security tools, hands-on labs, successful case studies, and tools to automatically create database queries.

Top 6 Custom System And Software Integration Companies In Vietnam

This article provides valuable insights into software and system integration (SI), empowering businesses and organizations to assess its significance and make informed decisions regarding implementation.


The year 2024 promises to bring new advances in event technology, with the birth of many creative and unique ideas. Here are some highlights

Pharma ERP Systems: Boost Efficiency, Compliance & Profit

You want to implement an effective Pharma ERP system but don't know where to start? Let's refer to the following article by Aegona for the most popular ERP modules.

Comparison Of Odoo Inventory & Inventree About Efficiency In Management

Learn about the differences between Odoo Inventory and Inventree to choose optimal solutions and help you make an informed decision in choosing open-source warehouse management software.

Flutter Developers Available For Hire | Mobile App Development Company

Due to high demand and limited supply, the cost of hiring in-house developers can be quite high. In this article, we will explore the remote and onsite Flutter developer outsourcing services offered by Aegona.


Does your business need a website with basic features? Odoo website is the solution that can help create a user-friendly and easily customizable interface.

Aegona dong hanh cung chuong trinh ngay hoi vi moi truong 2024

Aegona joins hands in protecting the environment alongside the Quang Trung Software Park (QTSC). Protecting the environment - Protecting the future.



You can reach our customer service at 84-28-71092939 or [email protected] For additional assistance, we offers the following support channels Contact Us

contact us