The use of the blockchain technology just went a notch higher with the largest credit bureau in Eastern Europe set to implement it in securing and storing customer information. While credit rating agencies are focused on ascertaining the creditworthiness of governments and businesses, the credit bureaus collect account information to determine whether individuals are creditworthy.
The largest banks in Poland own the Polish Credit Office, commonly referred to as the Informacj Kredytowej, which is used to track credit histories numbering approximately 140 million.
The credit office seeks to develop a durable medium of information and has since signed a partnership with a fintech company called Billon. According to the press release, the Polish Credit Office works hand in hand with the company that has its headquarters in London, to develop an information medium as per the EU directives and regulations like the MiFID II and IDD directives.
To ensure that the blockchain technology used by the fintech company could handle approximately 150 million documents monthly, the system was put to test by eight Polish banks. The conclusion? Billon’s blockchain is sufficient to support paperless customer service even for the largest institutions.
The technology is GDPR-compliant as personal account data can only be erased by the blockchain itself. It has since been approved by the Polish authorities. According to Billon, their technology is a “civilized blockchain” that processes fiat currency as it uses E-money which is EU’s legal tender. Therefore, in respect to the 2009/110/EC E-Money Directive, there is no room for new currencies. The technology uses encrypted files to store virtual money in a cloud or on mobile devices.
The medium received a financial boost worth 2 million euros as a grant from the EU’s largest research institute. In June 2017, it also received FCA approval.
According to the Polish Credit Office President, Mariusz Cholewa, the partnership between the two entities is long-term and will transform how business is conducted in the financial sector through client communication. They look forward to expanding the financial solution to include the remote signing of online agreements and active confirmation through electronic delivery. The solution aims to meet all requirements of a durable medium of information, legal or otherwise as well as the EU GDPR compliance.
On the other hand, the Billon CEO, Andrzej Horoszczak termed the partnership as a true revolution of information management. Closed central databases will now be a thing of the past as credit bureaus embrace the democratic internet- based blockchain technology that allows each user to control their identity.
The solution creates a level playing field between corporations and individuals and fixes the problem of consumer data control. And the benefits are not limited to the financial sector. It is anticipated that the solution will be adopted across other sectors as well such as the insurance, utilities and telecommunications industries. This partnership acts only as the first step in the using mass blockchain technology in trusted document management.