Trend 2: Transparency in the Supply Chain
The supply chain industry is currently facing a number of challenges. Accounting systems lack the capability to handle a large number of transactions, correcting mistakes takes too much time and money, products spoilage in the process of transportation leads to enormous financial losses, transportation costs a lot of time and bureaucratic effort, which in the end results in fraud and causes a lot of errors. Such complexity of tasks and challenges of modern supply chains require a systematic and secure approach offered by blockchain technology. Let’s see the most common applications of it.
- Blockchain allows the creation of a cloud unified digital management system to track the cargo location in real time. Walmart already uses this to supply certain products and the largest chain retailer in North America plans to move all food supply chains to the Food Trust blockchain developed by IBM.
- Tracing the origin of goods from a store to a specific location is also possible through leveraging blockchain technology. Each batch of goods is equipped with a tag that continuously monitors the location of items and interactions among participants in the supply chain.
- Blockchain technology also helps automate most of the workflow and business processes through the usage of smart contracts. It will significantly reduce errors, detect frauds, and speed up the delivery of goods. Maersk, for example, partnered with IBM to launch a logistic system based on the Hyperledger Fabric blockchain named TradeLens. The system tracks shipping freight traffic and exchanges customs and financial information between supply chain participants.
You can find out more about blockchain adoption in supply chain management in our article.
Trend 3: Fintech Transformation
Both banks and their customers already greatly benefit from blockchain technology. First of all, blockchain networks with decentralized and transparent digital ledgers are much safer than traditional ones. Nobody has access to private financial information and the ability to modify it apart from its owner. When identity management is run with blockchain technology, users can choose how to identify themselves and with whom to share their information. Blockchain in Fintech enables users to use a digital fingerprint scanner that can be stored on a distributed ledger and securely used by any bank in the network.
Blockchain as a service also significantly cuts down on transaction fees and eliminates delays in worldwide payments. The transaction doesn’t imply any fees and currency exchange losses so it’s much cheaper than traditional international transactions. McKinsey states that blockchain solutions for fraud detection, regulatory compliance, and onboarding can also significantly save banks’ costs.