The rise of blockchain technology in 2008 revolutionised different industrial sectors. Blockchain is a game-changer for all the industrial sectors, and companies cannot afford to ignore it. It is considered to be the ground-breaking innovation of the internet era. A major breakthrough in information storage and transmission, blockchain is likely to transform the existing operating models of the BFSI industry.
The technology experts Dr Garrick Hileman & Michel Rauchs in 2017 surveyed 132 use cases of blockchain technology and grouped them into different industry segments. The below pie chart depicts the percentage share of blockchain technology in various industries. BFSI industry has the most extensive set of use cases with a share of 30%.
The blockchain technology has found its way into the banking sector. A survey report from 2018 says 69% of Indian banks are experimenting blockchain.
Let’s have a look at how blockchain is making a dent in the BFSI sector.
1. Reduced Fraud
A cybercrime data says 45% of the banking and finance sectors suffer from financial crime annually. Blockchain being a new technology, it’s potential to reduce frauds is commendable. It has gained popularity across financial intermediaries like stock exchange and money transfer services. Currently, the BFSI industry has implemented centralised databases that are vulnerable to cyber-attacks as a single point of failure. A secure system to avoid such attacks is crucial for the BFSI industry, enabling safe transactions.
Operating on a distributed database system, blockchain is more secure and reliable technology, eliminating single point of failure. It stores every transaction in the form of a block using a cryptographic mechanism. These blocks are linked to each other simplifying the technique of tracking a security breach. In other words, a security breach in a single block affects the other blocks connected to it, enabling a secure system to eliminate cyber-attacks.
The global BFSI security market size is estimated to reach USD 74.3 billion by 2025, expanding at a CAGR of 13.1%, according to a new report by Grand View Research, Inc. Increasing risk of data loss owing to cyberattacks on banks and insurance companies is anticipated to propel the growth.
Thereby, cyber threats have prompted financial institutions to deploy reliable safety solutions at their premises.Frequent emergence of new malware variants is driving demand for advanced safety solutions in the banking, financial services and insurance security market.
For instance, in 2016, a mobile malware, masked as an application upgrade, was discovered.
The malware displayed fake sites over authentic banking homepages for filching banking credentials of consumers.
Financial databases stored on cloud create need to verify safety systems of the cloud service provider.
The market is lucrative in developing regions, such as Asia Pacific, owing to digitalized business operations in the BFSI industry.Financial companies are stressing on consumer data protection and are implementing solutions such as firewall and threat management software.
AngularJS is useful for the BFSI sector and takes the banking operations to a new level while making banks ready for the future.
Let’s connect to discuss the scope of this robust framework for your banking requirements.
