The term “Blockchain” refers to a method of storing cryptographic information that is nearly impossible for the system to hack, manipulate, erase, edit, or change. It is a type of distributed ledger that enables the duplication and distribution of transactions across a wide-area network of computers participating in a blockchain.
It stores transactional records in the form of blocks in several databases referred to as a ‘chain’ in a contested network, with the help of peer-to-peer nodes.
This storage mechanism is typically known as a ‘digital ledger’. Each and every transaction in this particular ledger is verified and authorized by the digital signature of the owner. This is how a cryptocurrency transaction is authenticated, safeguarding it from hacking and fraud.
Exploring Blockchain in the Global Payment Sector
To be very frank and candid, blockchain technology goes far beyond cryptocurrency and Bitcoin. It can save time and money for merchants, apart from providing transparency and fairness in crypto transactions.
It has diverse applications in different sectors, especially in the area of secure payment processing. Let’s understand the top applications of Blockchain in the real world.
1. Cross-Border Payments – Traditional methods of making trans-border payments can be complicated and time-consuming. But with blockchain, it has simplified the process of cross-border payments to a great extent, and with companies like “UniPayment”, end-to-end remittances without any intermediaries are now possible for all merchants, cryptocurrency traders, brokers and individuals. One such company offers blockchain services that help in international remittances within 24 hours or less.
2. Money Transfers – Using blockchain as a technology, money transfers or wire transfers can be comparatively less expensive, foolproof, secure and quicker than all other existing forms of traditional money transfer services, be it Western Union, PayPal, etc.
This is a kind of payment revolution that is taking the world by storm, especially benefiting those who are into cryptocurrency trading. With blockchain, money transfers happen in minutes, unlike the traditional system, which takes days.
3. Cryptocurrency Trading – This is undoubtedly the most popular application of blockchain. The one major advantage of cryptocurrency using blockchain is that it has no geographical limitations or boundaries whatsoever.
The use of crypto coins for transactions is prevalent all over the world. In one word, this is a perfect example of the blockchain payment revolution, which surpasses and bypasses regional payment Apps that have certain geographic limitations, just like Paytm in India. It has truly revolutionized the concept of international payment and cross-border money transfers.
4. Lending Mechanisms – Today, lenders can use blockchain to provide a variety of loans against collateral, via smart contracts. Such smart contracts that are built around blockchain technology help in the automatic triggering of activities like repayment of loans, release of collateral, service payments, etc. This is how faster, cheaper and efficient loan processing can be expected, with lenders offering comparatively better rates.
5. Healthcare Sector – Blockchain is showing a massive impact on the healthcare industry by using smart contracts. It means that a contract is drafted between two parties, without the need for any intermediaries. All the parties are aware of the contract details, and it is automatically implemented once the conditions of the contract are fully met.
It is quite effectively used in the healthcare sector, where a patient’s health records can be encrypted via blockchain, which means only the healthcare service provider is able to access the records with the help of a key. It also ensures the confidentiality of patient information, which cannot be accessed by anyone.
6. Birth & Death Certificates – A considerable number of people around the world do NOT possess legitimate birth certificates, especially in underdeveloped countries. The same goes for death certificates, which an international body like UNICEF has confirmed in its report. This is where blockchain can help solve the problem, by creating a secure storage for birth & death certificates that can only be verified, authenticated and accessed by concerned government/federal authorities.
7. Insurance Sector – It is by using smart contracts on a blockchain network, insurance companies can provide a higher level of transparency to their customers. When all claims made by customers are recorded safely on a blockchain, it is nearly impossible to duplicate claims for the same event, thus preventing fraud, forgery and malpractices. Moreover, with smart contracts, the process of claim settlement is faster than usual.
8. Real Estate industry – All real estate transactions require humongous paperwork for verifying land records, owner information, transfer deeds and ownership titles to new buyers. Now with the advent of blockchain, the realty sector in the US and all over the world can record transactions in a more secure, safe and accessible manner, apart from verifying information and transferring ownership of property. This helps in reducing paperwork, faster transactions and lower costs.
9. Online Identity Verification – It is not possible to perform any virtual or digital transactions without proper customer identification and verification. This is the case with all online banking and financial service providers across the globe.
With blockchain, the customer identity verification process can be centralized, thereby ensuring users for a one-time verification, and for sharing the information about identity with their choice of service providers. Here, users are provided with options to choose verification methods like facial recognition, user authentication, codes, etc.
10. Securing Personal Information – With the use of advanced digital storage technologies like blockchain, highly secure and sensitive personal information like social security numbers (SSN), date of birth, bank account number and other identifying information can be kept safe.
It is more secure than traditional systems, which are highly susceptible to hacking and phishing attacks. Such improved encrypted technology can be used to verify critical information and provide access to end users in industries like healthcare, travel, hospitality, insurance, finance and education.
Final Note
These were some of the major applications of blockchain that are revolutionizing the payment sector that need a robust form of technology, which is safe, quick, efficient and hard to infiltrate. It is no wonder that a majority of industries and companies are slowly migrating to blockchain technology to improve their customer satisfaction (CSAT) index, and at the same time, providing a higher degree of transparency to their clients.
