Bank Of China Becomes The First Financial Institution On New Blockchain Platform For Home Buyers

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The blockchain technology is gradually transforming the global economy. The real estate market isn’t exempted from the impact of the blockchain. The proposed launch of a platform for property buyers on the blockchain is expected to improve the real estate market. The platform is a project by the Hong Kong Applied Science and Technology Research Institute (ASTRI) and the New World Development, a building construction company.

Reportedly, Bank of China becomes the first financial organization to use this blockchain system. This platform tries to improve the processes involved in property acquisition by replacing paperwork operations with digital authorization. This development hastens the completion of activities such as processing of mortgage application and signing of the Sale and Purchase agreement.

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With this improvement, selected banks will receive encrypted and digitally signed purchaser’s authorized provisional agreement from the platform users. It is anticipated that there will be a boost in the population of users. This increase will result from the incorporation of distributed ledger technology (DLT) into the internal operations of organizations. Supposedly, the integration of DLT will help reduce the operating costs of banks by 15 to 60%.

The DLT benefits users since it allows secure transfer of information over the blockchain platform. Consequently, transaction histories and customers’ data can be shared without compromising this confidential information. Moreover, Hugh Chow, the ASTRI CEO affirms that the DLT can hasten the processes involved in property purchase. This improvement will improve the real estate market.

Blockchain And Financial Institutions

The use of blockchain technology is gradually gaining ground. The Bank of China in partnership with China UnionPay (CUP), a financial service corporation, experimented on improving payment systems using the blockchain. The project which commenced last August aims at building a cloud flash payment app that will allow users to transfer, trade, and spend money on it. With this proposal, the CUP planned to create a mobile integrated financial services platform on the blockchain.

The blockchain technology has also brought changes to the private sector. The China Banking Association (CBA), a self-regulatory financial institution in China, reportedly announced the launch of its blockchain platform. It was revealed in January that this project will improve the efficiency of the banking sector by transforming financial transactions and services. The scheme, “China Trade Finance Inter-bank Trading Blockchain Platform” is expected to transform the sector.

Blockchain Technology In Agricultural Finance

Other sectors of China’s economy are also implementing the blockchain technology. The recent government program on rural revitalization, “Guiding Opinions on Rural Service Revitalization”, is an excellent example. The project uses blockchain and other new technologies to improve financial services in the rural sector.

The adoption of this technology in agriculture financing will aid the collection and transfer of information related to agriculture. It will also enhance the assessment process of agriculture businesses for loans. With this improvement, farmers can secure loans without stress. Besides, it will minimize the risks associated with the issuance of loans and more creditors will be willing to finance agricultural projects.

China is a pacesetter in applying the blockchain technology to the various sectors of its economy. This development will boost its financial system and encourage other countries to adopt the blockchain technology.

Do you think this move by the Bank of China will propell other institutions into the use of blockchain technology in the financial sector? Share your thoughts below.

Max writes about blockchain projects and regulation with a special focus on United States and China. He joined Smarterum after years of writing for various media outlets.

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