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Blockchain tech 'safer, to cut cost of financing'

Banks to be managers of identity, not managers of money

October 27, 2019 00:00:00


Bangladesh should adopt blockchain technology in the financial sector as it is still evolving and it is the future, said one of the country's top IT professionals on Saturday.

"Blockchain is an evolving technology, we really should be using it at this level," said Habibullah N Karim, founding secretary general and past president of Bangladesh Association of Software and Information Services (BASIS).

"If we wait and adopt blockchain at a stage when it is a mature platform, the bus is already missed, we can't afford this," he further said at a workshop organised by BRAC Bank Ltd in the city.

Blockchain is a system in which a record of transactions made in bitcoin or any other cryptocurrency is maintained across several computers that are linked in a peer-to-peer network.

BRAC Bank in collaboration with Policy Research Institute of Bangladesh (PRI) organised the workshop on "Application of blockchain as a technology for SME (small and medium enterprise) financing and mortgage/lien" at its head office.

Founder and President of the Hong Kong Blockchain Society Lawrence Ma conducted the workshop.

While speaking as a panel speaker, Habibullah N Karim said blockchain along with artificial intelligence is the future.

He said the government is more prepared to adopt blockchain technology than the private sector.

"Blockchain is very complex and everyone can't learn it, but everyone can use the technology," he said.

"So it is very important to have collaboration among academicians, government and industry for making blockchain accessibility easy for all."

BRAC Bank Chairman Ahsan H Mansur said regulations are as important as technology.

"I still believe currency should be regulated by the central bank and blockchain also should have regulations," he said.

Mr Mansur said the use of blockchain in trade financing has great potential in Bangladesh due to the country's growing economy and increasing volume of export and import.

Lawrence Ma said role of a bank using blockchain will change and it will be a manager of identity rather than a manager of money.

He said blockchain is no magic, it will not remove middlemen from the transactions between two and more parties as many people mistakenly think.

He said people will accept blockchain ultimately as it will reduce cost and it is safer.

However, he didn't endorse the much-hyped bitcoin, a cryptocurrency, as it is not verified by any authority.

PRI Chairman Zaidi Sattar said: "We are passing through many revolutionary transformations in technology including blockchain".

He expressed hope that blockchain would reduce the trade cost globally by US$5 trillion once it is in use widely.

Chairman at Asian Tiger Capital Partners Iftakharul (Ifty) Islam proposed a consortium blockchain for SME lending in the country.

He thinks SME financing through blockchain would help remove information asymmetry.

He also suggested a project for blockchain technology before the start of using it widely as the technology is at a very early stage.

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