Blockchain technology is now making inroads into the banking sector in Cambodia. The Southeast Asian nation’s central bank — The National Bank of Cambodia has joined forces with Soramitsu, a Tokyo, Japan-based fintech startup to develop blockchain-based payment system.
Through this latest partnership, the National Bank of Cambodia looks forward to exploring the use of distributed ledger technology to offer a fast, secure and cost-efficient fund transfer method to Cambodian population. As a part of this initiative, Soramitsu is expected to make use of Hyperledger Project’s Iroha blockchain-based payment infrastructure to develop the solutions in accordance with the central bank’s requirements.
According to media reports, the National Bank of Cambodia picked Soramitsu after examining various alternatives. The implementation of blockchain technology could help the central bank reach out to the masses with the much-needed basic financial services that currently eludes the population.
A country with limited financial infrastructure has a much greater mobile phone penetration. As people increasingly adopt to mobile wallets and other simple financial applications, the introduction of blockchain-based application, backed by the central bank will provide the much-needed flexibility, accountability and reach. The bank’s initiative will also increase the acceptance of cryptocurrency technology in the country, as it also doubles as the country’s regulatory body.
A majority of the leading banking institutions across the world are involved in the development and deployment of cryptocurrency technology based applications. A number of consortiums have also been set up in partnership with banking and financial institutions, blockchain solutions providers and tech companies. Cambodia has joined the movement a bit late, but it is definitely not the last country to consider blockchain adoption.
In addition, the recent revelations about the SWIFT network or parts of it being compromised by the NSA have also impacted the security and credibility of the existing banking system, creating a need for more secure infrastructure. A proper implementation of distributed ledger may help restore the lost confidence in the financial system.
Ref: Nikkei Asian Review | Image: NewsBTC