Bank Chain - In­dia’s own hy­per ledger sys­tem

Banking Frontiers - - Distributed Ledger - Mo­han@bank­ingfron­

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.

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