Bill Payments, page-103

I will state I am not a technical expert, but find block chain and its uses fascinating as an amateur.

Currently, most financial institutions, insurance companies, stock exchanges governments etc store information on large central databases. Often for these businesses to transact with each other takes time, as the information needs to be retrieved and be in a format understandable by the other system, to be meaningful and be settled.

Block chain works on the basis of a distributed ledger. Essentially these can be private groups or public, In short all members of the group have total visibility of the ledger, the buys and sells and personal ledgers are updated in real time, while the identity of participants and the value they hold remain anonymous. The distribution of the ledger over many group participant computers and the" trust" (i.e. the majority records overrule irregular ledgers) means that it is very difficult and costly to manipulate (i.e. the cost is not worth the effort). One network going down does not collapse the system.

The technology can be used in financial transactions, record share movement, land titles, legal transmissions etc etc.

If you ever tried to send money through a bank oversea, it is costly and takes time. This is because the bank sends it to a clearing house, the clearing house contacts the receiving bank, the clearing house converts the currency and then sends it to the receiving bank, The receiving bank then puts in in the overseas account.

With block chain a group could set up an exchange to transfer cross border in real time based on protocols the group adopts. Bitcoin works this way. It is possible to avoid banks, clearing houses etc. Real time, low cost. It is like comparing old mail services to email.

Naturally banks don't want peer to peer and business to business groups to grow. That is why they are investing to run the groups. Governments are looking at crypto currency as substitutes for physical currency, stock exchanges for real time settlement (forget T +2). It will not change overnight, but the change will come, just as email is replacing surface mail.

In terms of TSI, managing groups for banks would be a focus. Implementing novel ways of speeding up common transactions using block chain, whether wallets or crypto currency would be areas worth exploring, especially with NOV. Naturally, if using crypto currency you will need a place to cash your chips in local coin and (as shown in an early story I posted) OKI sees their ATM with these functions growing in India.

Naturally I see the benefits in the tech and the opportunity. It only benefits us if we close deals.

Cheers