Barclays Africa Group has been experimenting with blockchain for some time and now it’s joining a consortium of 50 banks and financial institutions to design and deliver distributed ledger technology to global financial markets.
Absa, a Barclays subsidiary, will help develop a collaborative working group with New York-based R3 and other South African banks to develop Africa’s first blockchain banking solution. All participating banks will share intellectual property.
The global R3 blockchain consortium is a financial innovation firm that has partnered with the world’s leading banks.
Financial services are a hotbed of disruptive technologies and banks across the world are eager to embrace these to stay competitive and relevant. Many people believe blockchain technology has the potential to change financial services as profoundly as the Internet changed media and entertainment, said Tech Financials publisher Gugu Lourie.
The addition of Absa to the consortium is a significant milestone for R3, said David Rutter, CEO of R3.
Recently, R3 completed a trial of five blockchain technologies in the first test of its kind. The trial involved trading fixed income assets between 40 of the world’s largest banks across the blockchains, using cloud technology providers within R3’s Global Collaborative Lab.
The banks included Barclays, Deutsche and HSBC. They connected to the R3-managed private distributed ledger technologies built by Chain, Eris Industries, Ethereum, IBM and Intel.
There are more than 10 blockchain-based experiments and research initiatives being piloted within Barclays Africa, according to Andrew Baker, chief information officer for corporate and investment banking at Barclays Africa.
With industry alliances such as R3 and growing regulatory acceptance, widespread adoption will happen fast and disruptive innovation will become more mainstream, Baker said.
“Barclays Africa has been experimenting with blockchain for some time,” Baker said.
The bank has also been working with distributed ledger technology startups. In mid-2015 Barclays launched an Africa-wide blockchain supply chain challenge through its Rise open innovation initiative.
“We see huge potential for financial institutions in Africa to embrace disruptive technologies like blockchain, and use them to empower individuals and improve the lives of their customers. However, its true value will only be realized if we work together to co-develop and share solutions to common problems,” Baker said.
Barclays Africa hosted the second Blockchain and Bitcoin Africa Conference in February.
What is blockchain?
Blockchain is a technology for a new generation of transactional applications that establishes trust, accountability and transparency while streamlining business processes, according to IBM, Tech Financials reported. It is a design pattern made famous by bitcoin, but its uses go far beyond