14 May How blockchain can improve transaction speed, customer experience and trust
Blockchain is an emerging technology that allows data to be stored in a distributed ledger and continuously verified by network nodes that secure and process block transactions. Due to the fact that blockchain records all transactions between a company and its vendors and customers, it creates an immutable record of transactions without the need for third-party validation.
What does this mean for C-Level Management?
Let’s focus on the CEO and CFO here:
There are different payment methods used today in the enterprise-record-to-report (RTR) and purchase-to-pay (PTP) the transaction necessitates one set of verification records on the seller side and another set on the buyer side. Functionally, both parties have versions of order confirmations, receipt verifications and payment verifications.
Blockchain however allows a buyer and a seller to share the same version of the transaction, improving transparency in the F&A function and eliminating clearing requirements. For those who oversee these processes, blockchain offers the potential for increased data integrity, quicker reconciliations, reduction in close time, increased audit efficiency and improved real-time financial information. These functions can take place across the globe without impediments posed by national borders and currency.
We all see the digital economy coming and need this form of currency exchange to solve the growing demand for faster transactions.
Banking institutions are creating “digital banks” to attract and retain a millennial client base who are redefining customer experience. Ripple for example has been partnering with financial institutions running proof of concepts.
So, how do today’s enterprises improve speed, customer experience and trust? Could blockchain prove to be a “trust machine,” as some say? Because transactions that are recorded on a blockchain do not involve an intermediary, the customer owns his or her own data becoming their own bank and the odds of a security or data breach are very, very small.
We continue to watch how partnerships develop over time and will report as new blockchain projects roll-out.