NRI to test application of blockchain in banking

NRI to test application of blockchain in banking

Nomura Research Institute (NRI) is to conduct a proof of concept (PoC) test of the application of blockchain technology to the core architecture of Japanese Internet bank SBI Sumishin.

NRI says the PoC will examine business scenarios and validation items, prepare prototype systems based on these anticipated business scenarios and uncover ways to practically apply blockchain technology at the bank. Dragonfly Fintech (DF), a Singaporean distributed ledger startup, will provide NRI and SBI Sumishin with the technology necessary to conduct the study.

DF's Automated Clearing and Electronic Settlement (ACES) initiative aims to create a low-cost next-generation electronic monetary system for banks which will include the provision of tools to meet compliance requirements.

“This PoC is a strong example of NRI’s continued commitment to open innovation, through collaborations with various firms, to create new value in the marketplace,” says Minoru Yokote, senior managing director of NRI. “NRI is committed to examining technical challenges of blockchain and suggesting ways to apply this technology to the banking industry.”

In October 2015, NRI also initiated a PoC for blockchain technology focusing on the securities industry, in collaboration with Nomura Securities.

Meanwhile, in neighbouring Singapore, DBS and Standard Chartered are working on the application of distributed ledger technology in trade finance. The banks have completed tests on the technology and will start collaborating with other companies next year.

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