Australian Big Banks are joining in on the Blockchain bandwagon

Deloitte performed Worldwide Blockchain Research with 1000 banks in 2018, revealing the industry's interest in Blockchain technology. More than 95 percent of participants said that they would participate in blockchain or distributed ledger technology in some way.

Fast forward two years to the globe grappling with an unexpected pandemic and fast-increasing economic digitalization, and it appears that the Deloitte survey's interest has transformed into action. For banks, the appeal extends far beyond expense reductions and network optimization.

Blockchains can help RTGS (Real-Time Gross Settlement) evolve, enhancing the safety of digital transactions and reducing the risk of accounting mistakes, ambiguity, duplicate counting, and forgery. Accounting and auditing are excellent illustrations of sectors that are poised to be revolutionized by Blockchain.

The changing circumstances of the world are also addressed by blockchain technology. Just before the Covid outbreak, people, especially in Asia, people were already reducing their usage of physical currency, but the pandemic crisis has accelerated the scope and importance of digital transactions. The worldwide digital payments sector has grown by 16 percent per year on year to 5.4 trillion USD by the conclusion of 2020.

Oppositions to Australia's main banks have criticized them for being overly conservative about cryptocurrencies and impeding growth by refusing the Fintech industry's critical capabilities. Amid a surge of innovation in financial institutions, a probe has focused attention on growing tensions over "de-banking," in which Fintech companies competing with banks are refused basic banking solutions thanks to legislative issues.

Local banks routinely refuse to offer crucial payment systems to money remitters and cryptocurrency miners, according to Fintech companies who have testified to the investigation.

Customers may be de-banked because of safety considerations, such as their handling of monetary fraud issues and the lenders' desire to earn a profit from a banking relationship, according to banks. Major international Fintech businesses claim in comments to the investigation that relations with Australian banks have been difficult.

Wise (formerly TransferWise), a money exchange company located in the United Kingdom, said that it had difficulty obtaining payment facilities from Australian banks, which frequently ended negotiations after the first meetings. Wise said it was compelled to utilize multinational banks operating in Australia rather than a local collaborator because of the banks' attitude, which it stated increased anti-money laundering and counter-terrorism funding concerns.

The Commonwealth Bank of Australia and ANZ, two of Australia's major banks, are collaborating with XinFin, a prominent Singapore-based blockchain firm, intending to improve mechanization and efficiency in trading assets and hazard allocation. The XDC Network, developed by XinFin, is a fully compatible hybrid blockchain network that facilitates worldwide commerce and finance. The XDC Network is a first-of-its-kind trading investment group that uses energy-efficient smart contracts and digital asset technologies.

The worldwide Trade Finance Distribution (TFD) project, a collaboration of trade pioneers, credit insurers, and institutional financiers, such as the two major Australian banks, has chosen XDC Network as the first blockchain business to join. In a related development, the Standard Bank of South Africa is a part of both the Hedera governing council and the Trade Finance Distribution (TFD) Initiative.

Both XDC Network and Hedera are pioneering innovative solutions aimed at transforming the financial system as we recognize it. TFD Project is attempting to develop new technology-based marketplace norms and transaction data standards to enhance the availability and openness of trade flows to establish trade as an investment class.

This will let banks reach out to new kinds of financiers such as institutional investors and family offices, resulting in a more robust trade finance environment. The XDC Network uses cryptographic tokens to enable the digitization, tokenization, and quick settlement of trade transactions, eliminating the dependency on complicated foreign exchange infrastructure. Lower transactional costs, reduced energy usage, faster verification times, double authentication, and randomization are just a few of the main benefits.

Through this smart contract technology, XDC introduces new streams of liquidity to international trade financing. By embracing the TFD Initiative, we will be able to collaborate with a variety of bank and non-bank pioneers to help reduce the SME funding gap. Smart contracts are anticipated to improve operational efficiencies and reliability by eliminating the need for contractual parties to trust one another; rather, confidence is placed in the code.