FIU Pension Fund in Russia to Leverage Blockchain For Cutting Costs and Labor Transparency

Blockchain Technology Adoption For Russia’s FIU Pension Fund Supports Transparency In Labor Agreements

Blockchain technology is one of the greatest innovations to come out of cryptocurrency, and it is being adopted for use around the world in different industries. One of the latest examples of this is in Russia, where the FIU pension fund will use blockchain technology as a way to setup all proposals in one platform. By condensing this process and this record, servicing and storing costs for the data will greatly decrease. In a more specific use-case, there will be a clearer record of labor relations agreements, helping to reduce the risk of rights violations between workers and employers.

Right now, the FIU’s database contain information from employers about insurance premiums and tax deductions, which is all stored with centralized servers. Once the distributed ledger technology is established, it will be possible for the company to use distributed databased to house the information. Every single agreement will be recorded on the ledger, which means there’s no way to fraudulently sneak into the contract to edit it later. Furthermore, these smart contracts will stop compulsory exclusion, due to the digital format.

The FIU is clear in how helpful blockchain technology can be, especially when it comes to certifying centers and employers. Stopping illegal contracts for employment will both protect potential workers, while reducing the costs associated with servicing and data storage. Labor violations are a major concern among both small- and medium-sized businesses in Russia, according to Professor Alexander Shcherbakov of the Russian Academy of Science and Technology. However, with these contracts established on the ledger, it will be easier to monitor them.

The majority of employers within Russia violate the rights of their workers from the moment that they apply to work with their company. Much of this treatment continues until they are eventually terminated, or they quit. In fact, there were over 465,000 appeals filed by citizens in Russia in the last year alone regarding the potential for labor violations. By integrating smart contracts, the level of transparency can help with the freedom that workers crave as a result of termination.

Transitioning to an economy that is fully digitized is becoming commonplace for many industries, but it also helps to provide honest and helpful services to consumers. Tourism, transportation, and trade are just a few of the industries that stand to benefit from the organization that blockchain offers. In fact, this Russian pension fund presently includes big corporations as well, like Airbnb, Saloodo, Alibaba, and Amazon. Once launched, the new platform should help with the continued digitization that is happening in Russia right now, possibly stimulating this change in other countries as well.

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