Nxchange pioneers ABN Amro’s blockchain tech for escrow accounts
ABN Amro Clearing Bank (AACB) has developed an alternative for escrow accounts – based on blockchain technology.
The solution was developed in consultation with an Amsterdam-based start-up, Nxchange (a white-label stock exchange where companies and financial institutions issue and trade equity and bonds). Nxchange is also the first client to launch this solution, starting in February.
“Most non-bank organisations who are entrusted with client funds use escrow accounts to manage those funds,” AACB says.
“With this new service, every individual client of the non-bank organisation gets a bank account with the AACB via the blockchain. That way, fund flows between the organisation and its clients are included in payment processes under regular supervision, guaranteeing the required transparency,” it explains.
By eliminating escrow account management costs, the new service “drastically reduces” administrative costs for the organisation, it adds.
AACB’s Jan Bart de Boer describes Nxchange as “the ideal party to be starting this innovation with”. Nxchange is itself an innovator, he says, with its “business model geared toward efficiency and transparency”.
De Boer says the bank is seeing “a great of market interest for this service”. Once the new functionality is tested further, assessed and improved where required, AACB will make the offering more widely available.