Bank Chain - India’s own hyper ledger system
India today has a platform designed to explore, build and implement blockchain solutions. Called BankChain, it is a collaborative effort of Primechain Technologies, which is the driving force behind the venture, and 20 banks, including State Bank of India, ICICI Bank, DCB Bank, Kotak Bank, Bank of Baroda and Deutsche Bank - India. The platform has tied up with Microsoft to use its Azure blockchain as the medium. It went live on 8 February.
SBI is taking the lead in developing blockchain based solutions for Indian banks. It has committed its Collaborative Innovation Center where various blockchain pilots will be tested on Microsoft Azure Cloud nodes.
BankChain has already tested and completed work on its first project, ClearChain, or c2. It is a blockchain for integrated and shared KYC and Anti-Money Laundering / Combating the Financing of Terrorism, or AML/CFT. The current version facilitates sharing of KYC data, investigation reports, suspicious transaction reports and cross border wire transfer reports.
The other projects that BankChain has taken up/intending to take up, include syndication of loans / consortium lending, trade finance, asset registry and asset re-hypothecation, secure documents, cross border payments, peer-to-peer payments and blockchain security controls. These pilots are at various stages of testing and completion. The promoters believe that once these nodes are available on the platform, banks and financial institutions in the country can derive the true benefits of blockchain technology, which include maximization of efficiency, security and transparency and minimization of fraud.
While membership of BankChain is now open, it is primarily targeting to allow universal banks, NBFCs, payment banks and other financial institutions to become members.
The components of a blockchain system today include a base operating system, configured instance of a suitable blockchain fabric, external databases, webservers, FTP servers, etc. Building a solution from scratch is expensive and time-consuming. And the entities behind BankChain understands this fully. So, they are all agreed to work on APIs, which have been developed by Primechain Technologies. These APIs are representational state transfer (REST), or RESTFUL, APIs, built on JSON standard, specifically intended for interacting with blockchains / distributed ledger systems that allow developers to add blockchain power to their solutions.
There are some exclusive benefits for BankChain members. These include access to mChain, which is a permissioned multinode blockchain that has 1 node for each BankChain member plus 1 admin node and 1 regulator node; access to dedicated Yobichain, which is a private blockchain ecosystem preloaded with web and FTP servers, a basic blockchain application, blockchain web demo and blockchain explorer; and access to source code and associated documentation files without restriction.
So, what does it mean that the platform is using Microsoft Azure?
Azure Blockchain provides an open, hyper-scale cloud platform with an ecosystem of blockchain technologies. Being cloud-based, the users can experiment, do pilots, innovate and create prototypes in a cost-effective manner. Microsoft has assured to provide hybrid cloud capabilities, compliance certification portfolio and enterprise security. This is expected to facilitate rapid adoption of blockchain through the products developed by the consortium. Such products will have applications not just in banking, but in the entire financial services sector and maybe at a later period in various other sectors, which may also mean the government sector. That way Microsoft may be gaining an edge over other similar blockchain developers, including the several consortiums that have been set up by global banks.