ANZ, Westpac and IBM trial blockchain for bank guarantees
Australia and New Zealand-based banking group, ANZ, and Westpac have teamed with IBM and shopping centre operator Scentre Group to use blockchain to digitise the bank guarantee process for commercial property leasing.
The trial used distributed ledger technology (DLT) to eliminate the need for current paper-based bank guarantee documents, resulting in a “single source of information with reduced potential for fraud and increased efficiency”.
The firms say the trial also addressed other inefficiencies, including tracking and reporting of a guarantee’s status through multiple changes.
Mark Bloom, CFO at Scentre Group, says an update of the “decades-old process” is “long overdue” and manual tracking of guarantees has been an “extremely cumbersome and labour intensive process”.
Nigel Dobson, general manager wholesale digital, digital banking at ANZ, adds: “We have been keen to avoid the hype surrounding blockchain and distributed ledger technologies, and instead focused on practical and deliverable use cases.”
Looking ahead, the companies say this trial “forms part of a broader plan to build a shared solution with the rest of the industry, and to invite other organisations to participate in a larger pilot”.
The trial used DLT powered by Hyperledger Fabric V1.0 – a blockchain framework and one of the projects hosted by The Linux Foundation.