Finance companies are being asked to come up with ways to verify that people are who they say they are using blockchain technology. The UAE’s Ministry of Economy has teamed up with the Arab Federation of Capital Markets (AFCM) to start a challenge for this.
There is a high level of trust in the data on the Blockchain.
The AFCM has teamed up with the UAE’s Ministry of Economy to launch a market-innovation challenge where participants are asked to build a blockchain system that can be used to know who you are (KYC). Challenge: The AFCM says that “enterprise-ready” fintechs and tech companies from the region and all over the world are welcome to take part.
In the AFCM’s words, participants should build a platform that “enable[s] transparency and immutability.” Such a KYC platform, in turn, would allow financial institutions to “verify the trustworthiness of data in the distributed ledger technology (DLT) platform,” which would then allow them to do this.
People who work for Arab exchanges and clearinghouses explain why they want the winning KYC platform to be built on the blockchain when they talk about why they started the challenge. AFCM:
“Blockchain will allow for an accumulation of data from multiple authoritative service providers into one single, cryptographically secured database. KYC verification through this type of architecture has the ability to be faster, more secure and more efficient than current verification procedures.”
AFCM said that a system like this could be more secure because only people who are supposed to have access to the data would be able to see it.
Disruptive technologies can be used to solve problems.
According to the judging criteria, a participating fintech’s proposed solution “must solve the problem with new, cutting-edge tech.” The proposed solution must also be relevant to the problem and be in line with local rules. If you want to win the challenge, only five fintechs will be left. The challenge is set to end on March 29, 2022.
Also, the Securities and Commodities Authority (SCA) is listed as one of AFCM’s strategic partners for this challenge. The UAE’s economy ministry is also on the list of partners.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.