In the digital era, Blockchain Service Number +1 478–304–8289, and Website- https://www.blockchain.com/ . many banks follow a contractual agreement (third-party imposed T&Cs) basis for the execution of exchanges and processes. However, providing significant attention to each user can delay the process while costing a lot of money. Whereas, deploying Smart Contracts on Blockchain networks enable automatic execution of contracts based on terms and conditions. This provides numerous potentials for the banks. Some of the benefits of Smart Contracts implementation by banks are:
Consensus Lending Process
Banking institutions that function on legacy systems usually follow extensive onboarding and lending processes for users. Therefore, a huge population of borrowers cannot satisfy the strict lending standards of legacy banking institutions. Similarly, cumbersome documentation and multi-stage authentication processes reduce convenience for users.Blockchain Service Number +1 478–304–8289, and Website- https://help.coinbase.com/en.
Smart contracts implementation eliminates the entry obstacles for users, SMEs, and start-ups. Besides, the deployment of the Smart Contract system helps banks to assess the credit score and loan eligibility of such borrowers. Using distributed ledger technology (DLT), banks can gain the potential to transform lending processes by accelerating the back-office procedures and bringing reliance & transparency among all parties. Similarly, loan funding and settlement processes can be executed at reduced costs.
Secure Auditing
The traditional agreements are typically based on stringent regulations that necessitate the banking workforce to devote much time towards the record-keeping process. This intensive record-keeping process is one of the major factors hindering the digitization of banks. Moreover, as banks contribute several services like allowing financial transactions, and providing loans it is necessary to record each activity in legacy systems. However, the impact of cyberthreats like malware, phishing, and ransomware on the records can certainly access the data and lead to critical security attacks.