Krungsri pilots blockchain-backed contract management system
Thailand’s Krungsri Bank (officially Bank of Ayudhya PCL) has announced it has successfully developed a blockchain-based clearance system to streamline the bank’s contract management process.
Partnering with IBM’s Cloud Garage team, the partnership devised a smart contract and consensus mechanism utilising blockchain technology. The system ensures that transactions are completed after contracts are satisfied and a consensus between parties is reached.
The technology has helped to “make information exchanges more efficient, while decreasing the number of questions incurred during the process and reducing the vulnerabilities of paper supporting documents including misplacement or incomplete information,” Krungsri explained in a release.
Krungsri chief information and operations officer Voranuch Dejakaisaya said the goal of the project was to digitise the bank’s paperwork processes, store document contents with authentication, and approve information in the blockchain-based database, with the eventual goal of expanding the platform across the bank and its subsidiaries.
“With thousands of agreements exchanged daily between the banks and its subsidiaries, Krungsri [has decided] to improve Related Party Transaction (RPT) process efficiency between the transacting parties by automating contract management processes using blockchain technology,” the bank said.
Krungsri said it expects to turn the initial concepts into reality within three months using the Hyperledger Fabric and blockchain services on IBM Cloud.
By leveraging blockchain, Voranuch is confident the newly digitised paperwork process will improve the bank’s information security, increase transaction transparency, and reduce operational backlogs.
“We expect the project to upgrade our back-office efficiency, while converting physical documents to electronic files. With the decentralised solutions, the process run on blockchain brings transparency, [fewer] errors and more security. Also, the bank can efficiently reduce operating cost and better deliver customer service,” Voranuch added.
Krungsri is Thailand’s fifth-largest universal bank in terms of assets, loans and deposits. Its services include wealth management, credit cards, non-life insurance, asset management, securities trading, auto hire purchase, equipment leasing, factoring, micro-finance and instalment loans.