The International banking consortium has been working along with the New York-based fintech service company, R3CEV for a while now. After about 6 months of research and development, the consortium has come up with a distributed ledger platform called Corda. Corda was recently unveiled by the R3 Consortium, the consortium of 41 international banks and R3CEV.
Corda is specially developed for the banking sector to enable them transfer funds across their branches using blockchain technology. The blockchain technology offers a faster and a much more efficient way to transfer funds between branches while circumventing the existing SWIFT network. The banks are wary of using the SWIFT network due to two reasons; the time taken for international fund transfer and the cost of the transaction associated with it.
Blockchain technology, as noticed with Bitcoin, allows faster fund transfer while ensuring the security and integrity of the transfer. Banks are also striving hard to get the get on top of the blockchain game as they believe that they are under threat from bitcoin. The new Corda platform may alleviate at least some part of their problem as it brings them a step closer to achieving their goal.
The Corda platform is designed to record, manage and synchronize financial agreements between financial institutions. Unlike bitcoin blockchain, Corda comes with an additional privacy layer that prevents unauthorized access of blockchain data.
Going by the announcements made by the consortium, we can expect Corda to support smart contracts as well. Apart from Corda, two other banking majors BNP Paribas and the Bank of Ireland are also in the process of conducting a trial run of their respective blockchain technology based applications.
None of the blockchain-based applications from the banking sector have completely materialized yet. Most of them are still under the trial and beta phase. Will they become mainstream by the end of this year is something that we have to ponder over.