UnionBank of the Philippines announced on Monday a plan to link rural banks using blockchain technology to achieve an interconnection similar to what the SWIFT and Bancnet systems deliver.
UnionBank chairman Justo Ortiz made the announcement during the launch of the Blockchain Association of the Philippines. He said his company would initially pilot-test the system in six rural banks as per the approval from the Philippine central bank.
Through the application of blockchain, Ortiz hopes to limit the number of steps in completing certain transactions from 20 at present to just three.
He said:
"The rural banks are the first mile to getting those members of the community that are unbanked.”
20,000 blockchain programmers
As part of its ambition to capitalize on blockchain, UnionBank will expand its blockchain programmer team from 30 to 100 before the end of this year. According to Ortiz, the number is expected to jump to 20,000 within two years.
"We need to be able to bring people from abroad to basically up the game here at the enterprise level. At the end of the day, if the enterprises adopt, it will force the individuals to adopt. It's chicken and egg,” he said, adding that blockchain could help "crack the code of financial inclusivity."
Crypto is the future
In an earlier interview with Cryptovest, UnionBank CEO Edwin Bautista described cryptocurrency as the future in answer to the question why UnionBank is the only one of 10 banks in the country to have welcomed blockchain and digital currencies.
“We really do not know if cryptocurrency will be the future currency and replace fiat. No one knows for certain. But what if it were? We have to keep an open mind about it. We cannot reject something just because we do not understand it,” Bautista said.
UnionBank inks blockchain payment scheme with Visa
In January, UnionBank struck a deal with credit card services giant Visa to create a cross-border bank-to-bank (B2B) payment system that will benefit small- and medium-sized enterprises (SMEs). The first of its kind in the Philippines, the platform aims to facilitate B2B transactions, with a focus on those from SMEs to recipient banks.
Ortiz said at the time the Visa B2B Connect system would allow payment processing in real time or at least within a day instead of the usual three to five business days.
This article appeared first on Cryptovest
