That blockchain has a great potential within the financial landscape is clear by now. Especially within the pension industry, the benefits of blockchain can be of significant value. How this technology can be used might be less clear to many. This article briefly touches upon a selection of blockchain-characteristics that may prove valuable in the pensiontech scene, followed up by an introduction to the PensionTech Summit and meet-up next month.
Decentralization, integrity and immutability
Blockchain has a number of distinctive features that give the technology its potential. The decentralization of blockchain allows for non-manipulative logging of information. This way, for instance, the middle man can be cut out of transactions, speeding it up and lowering additional costs.
On the other side, and especially for the pension industry, a middle man can also be a useful asset in the value chain. A governing body regulating the data is often necessary and useful. The decentralized nature of blockchain doesn’t have to rule out the middle man. A governing body as middle man can regulate how data is made accessible to involved parties, allowing only the minimum amount of required data to be shared, even though more detailed information is stored on the blockchain. This way, participants receive the quantity of information that they require, while sharing a bare minimum of their personal information with others.
As blockchain builds upon previously entered data, once entered, the data cannot be altered or reversed (except for in with consensus in private blockchains). Therefore, given data entry is done correctly, this characteristic prevents fraud in operations requiring entered data. Once the respective block is added to the blockchain, it cannot be removed and thus becoming elusive for fraud.
An example of the combination of traits
When looking specifically at the pension sector, smart contracts written into blockchains have the potential to greatly increase efficiency within the industry. With smart contracts, the exchange of data, money, content, etc. can be done automatically without the interference of a central body. The contract is executed when pre-determined requirements are met. A governing body can set up the contract and its requirements, allowing access to the information only to those who require it and set it up for automatic implementation.
PensionTech Summit and Meet-up
The above-mentioned characteristics and example of blockchain in the pension sector are just the tip of the iceberg. On May 17th, MN, Holland FinTech and the city of The Hague are organizing the annual PensionTech Summit in the Hague. To prelude the event, we are also organizing a meet-up the day before. During this meet-up we are going to dive deeper into the use and potential of blockchain in pensiontech, led by MN.
In addition to hosting the event, MN will shed some light on what the future of financial services is expected to bring in terms of technological developments and the rise of artificial intelligence and their implications for the pensions sector. “As a new member of Holland FinTech we are honoured to host this event. It offers corporates, start-ups, and institutions an opportunity to exchange knowledge and insights, and jointly exploit modern technology, explore next possibilities and market demands for financial services and accelerate financial inclusion”.