Life beyond cryptocurrencies – Hong Kong and China fintech firms show there is more to blockchain
By deploying blockchain in their back offices, several companies are aiming to disrupt the traditional role of banks in extending loans and attracting deposits
Several financial technology companies in China and Hong Kong are showing how blockchain has so much more to offer than just cryptocurrency trading.
By applying the decentralised ledger technology to various parts of their back office, these companies have dramatically boosted their clientele while cutting back-office manpower. The use of blockchain also protects investors as it preserves incorruptible transaction records.
And, in this process, they might also be disrupting the role traditionally played by banks in extending finance.
Although banks are also exploring ways of incorporating blockchain into their operations, it is fintech companies, which are more agile and flexible in their organisational structure, that are embracing innovation faster than their banking counterparts.
Financial inclusion – extending credit to underserved segments that have limited access to bank services – is also being advanced further through blockchain. And as the technology becomes more widely deployed at the enterprise level, some argue it has the potential to replace jobs performed by auditors, notaries and lawyers, and other back-office roles in financial institutions.
Chong Sing Holdings Fintech Group, a Hong Kong-listed company that provides loans to small and medium enterprises and retail borrowers in China, has registered more than four billion transaction records using blockchain platforms developed in-house over the past six months.
