By Lee Kyung-min
A growing number of banks are seeking to apply blockchain-based technology to their products in a bid to provide more convenient and faster services for consumers.
The most notable move is a joint effort to establish a "self sovereign identity" being driven by a consortium joined by KEB Hana Bank and Woori Bank as well as other telecom, IT solution and fintech firms, such as SK Telecom, LG UPlus, SK Planet, KOSCOM and Coinplus.
"Self sovereign identity," is a new form of identification which, through a layer of technologies, enables individuals and organizations to assert their own identity.
This is different from existing identity certification processes which require the help of intermediaries including government-certified or public entities that manage personal data.
However, if the new system is implemented, a consortium-developed electronic wallet will be used for an individual to store key personal information including resident registration numbers, bank account numbers and use them whenever a need arises.
In the process, the risk of fraud will be removed as blockchain tech is known to be resistant to data modification, a reason why it is considered an efficient, verifiable and permanent method of keeping a record of transactions between parties.
Another strong point is that the data recorded cannot be easily altered retroactively, which helps ensure accountability.
Woori Bank will soon begin a trial run of the new ID method in some work processes while KEB Hana plans to use it in November.
Another move underway is a joint project between KEB Hana Bank and Korea University seeking to shorten the waiting period for issuing a student identification card with debit card function incorporated.
It will take only about three days for a student to have a new ID issued, significantly shorter than three weeks, the previously required minimum period.
This is possible as no in-person submission of related papers are required as data and content sharing among relevant departments of the two entities will be enhanced following an agreement signed by the two on April 19.
KEB Hana plans to expand this program to other universities.
KB Financial Group has joined hands with LG Group to provide a service powered by blockchain and artificial intelligence (AI).
To that end, the two signed a memorandum of understanding to jointly establish a blockchain-based infrastructure and use it for a consortium project.
"MONA Chain," a blockchain platform under trial run at LG Science Park in eastern Seoul, is a good example.
Under the platform, a customer can use tokens for the purchase of goods and services at the park, and final settlements of payment involving cash or credit card, which is processed by Kookmin Bank, will be made later.
From next month, Shinhan Bank will introduce a blockchain-powered loan application program, which will allow individuals to submit related documents without visiting branches.
The new program will be a major improvement from the existing system whereby only data managed by public institutions can be submitted through the non-face-to-face process with the help of the bank's "scraping" technology.
Woori has completed developing an overseas cash remittance program after participating in a project led by SBI Ripple Asia, a collaborative initiative between a blockchain tech firm Ripple Labs and Japan's SBI Holdings.