How cognitive and blockchain work together: the Yes Bank example

Major Indian bank innovates on client payment networks

Illustration by Dan Page

India’s Yes Bank is one of the first institutions to publicly announce innovation in payments using blockchain and cognitive technologies.

How do these technologies play together? First, blockchain is used by the bank to allow client Bajaj Electricals to handle payments to its vendors, with the distributed nature of blockchain meaning that all parties can securely understand the transfer of funds.

As Yes Bank’s press release points out:

“Capitalising on the efficiency and security features of blockchain, YES BANK has used the Hyperledger Fabric supported by IBM to design a vendor financing solution which allows Bajaj Electricals (anchor client) to digitize the process for discounting and disbursal of funds to its vendors by integrating seamlessly with YES BANK’s systems.”

The blockchain solution, developed with fintech startup Cateina Technologies, offers benefits including a reduction in the bill discounting process from 4 days to real-time, an end-to-end digital process, transparency to all parties using the blockchain public ledger and advanced security measures. You can understand more about blockchain in this short explainer video:

For the cognitive solution, Yes Bank will use IBM Watson Conversation APIs through the IBM Cloud platform to improve the digital experience for the bank’s partners, developers and corporate clients. For instance, when a member of the Yes Bank ecosystem is looking for support on using the bank’s API, the cognitive solution will be able to provide real-time answers by tapping into a backend repository, freeing up staff to concentrate on more complex problems.

This is just the beginning of this journey, says Yes Bank Managing Director and Chief Executive Rana Kapoor, speaking to the Financial Express:

“I strongly believe that we are only at the tip of the iceberg, and see blockchain, coupled with IBM’s cognitive solution on the cloud platform, making a significant impact in the global transaction banking space.”