Blockchain technology ushers in internet of value
Prof Dr Kriengsak Chareonwongsak | 10 Aug 2018 00:30
The most radical transitions in the financial and banking systems are the shift from offline service to online service and the shift from a “cash society” to “cashless society”, both of which are becoming increasingly apparent in many societies.
This second part of the series covers two other significant transitions within the financial and banking industry:
First transition: From ‘intermediation’ to ‘de-intermediation’
In the past, financial transactions were made through automatic deductions with traditional banks serving as the intermediator. While this has allowed customers to make transfers across different regions, the process is cost-inefficient and slow.
Even simple payments for products and services through credit cards would involve lengthy and expensive procedures that include credit checking, bank verifications, balance deductions and transfer through intermediaries.
The same holds true for international transfers which is an expensive and time-consuming procedure that requires the involvement of a number of intermediaries. Moreover, these international transfers would typically charge 5-7% for currency exchange.
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