RBI Exploring the Usage of Blockchain Technology to Secure Digital Future
The Institute for Development and Research in Banking Technology (IDRBT), under RBI, is working on a model platform for blockchain applications for the government in banking.
Previously the indian government had promised to explore the use of blockchain technology proactively to help usher in a more secure digital future. Now the research wing of Reserve Bank of India has said that it’s working on developing blockchain model to cater to the needs of Indian banks.
RBI Arm, The Institute for Development and Research in Banking Technology widely known as IDRBT is working on a model platform for blockchain applications for the government in banking. It will be documented and developed next year, AS Ramasastri, Director, IDRBT said. The platform will list all available blockchain applications for vendors or banks with interoperability parameters, among other tools. The plan opens up a new wave of opportunity for blockchain startups in India. As of now India has currently around 100 active blockchain startups.
However, the previous Narendra Modi government despite recognising blockchain as an essential technology to move forward did not do much to promote startups in this field, beyond producing reports. On the other hand, the RBI is currently setting up a regulatory sandbox which includes provisions for blockchain startups, and TRAI made it mandatory to use blockchain for tracking spam messages.
AS Ramasastri, Director, IDRBT said that the focus areas of research and innovation include analytics, cybersecurity, blockchain and payments systems.
There has been a lot of startup innovation in the sector and such a collaboration between banks, research institutions and fintech players will tend to increase not only revenues but also bring about innovation to benefit the customers.
Ramasastri has also emphasised that while there is huge scope for deployment of blockchain applications, a cautious approach is very much needed. Blockchain being explored for banking applications is in stark contrast to India’s stance on cryptocurrency, which is one of the applications of blockchain.