Nedbank, a traditional South African finance institution, is planning to debut smart contract applications to demonstrate its blockchain capabilities within the next six to 12 months.
While the exact details of the deployment of the technology are not yet known, a top executive of the bank has highlighted its potential in the agricultural sector.
Be smart💡:
Smart contracts: Smart contracts are digital contracts stored on a blockchain that are automatically executed when predetermined terms and conditions are met.
Smart contracts are typically used to automate the execution of an agreement so that all participants can be immediately certain of the outcome, without any intermediary’s involvement or time loss.
The details
- Corbus de Bruyn, head of client value proposition at Nedbank, told MyBroadband that the bank has acquired smart contract technology and is working to deploy it soon.
- De Bruyn pointed to agriculture as a sector where the technology could revolutionize current operations and help to save time and money with automated procedures that would otherwise require human involvement.
- According to him, implementing smart contracts can allow for the automation of imports, exports and trade, greatly reducing the time it takes to get these processes done traditionally.
- He added that it can also help the bank fast-track the credit financing process, making it easier for borrowers to receive loans as soon as the preconditions are met.
Key quotes
- De Bruyn said:
“We have the [smart contract] technology available and we’re working round the clock to make this available as soon as possible.”
- He added:
“Reducing or eliminating manual processes for our clients is what we’re seeking to achieve, but we’re also using the technology to enhance our own systems and processes so that we can truly provide next-level service to the agriculture sector.”
Zoom out
- While traditional finance institutions are still wary of cryptocurrencies, some of them are beginning to warm up to the underlying blockchain technology.
- This is attributable to the decentralization, transparency, security and speed that the technology offers, all of which are viable solutions to the limitations of traditional finance companies.
- Mariblock reported that large South African bank Absa CIB implemented a blockchain system to digitize its letter of credit issuance process.
- In the same year, South African big four bank First National Bank said it was working on a blockchain –based system to issue digital title deeds.
- FNB’s CEO Jacques Celliers added that while it remained unmoved by cryptocurrencies, the bank was working on other blockchain innovations in trade and commerce.
