The Bank of Tokyo-Mitsubishi UFJ, Ltd. (BTMU) and Hitachi, Ltd. have announced the start of Proof of Concept (PoC) testing for using blockchain technology for digitalization of cheques in the Republic of Singapore on 22 August 2016.
BTMU and Hitachi have collectively developed a system where blockchain technology is used for issuing, transferring and collecting electronic cheques. By using the system, BTMU is able to issue and settle cheques, and a number of Hitachi Group companies in Singapore receive the electronic cheque to deposit the funds. PoC testing allows Hitachi and BTMU to identify issues surrounding security, operation and legal perspectives. Both companies aim to build new FinTech services, including the digitalization of cheques.
The application of blockchain technology is expected to reduce system investments, whilst providing secure, reliable and convenient financial services. Digital cheques also make it possible to automate the workloads of intermediaries and rapidly settle cheques.
Through PoC testing, BTMU and Hitachi aim to put blockchain technology into practical use, and further contribute towards global expansion and evolution of FinTech services.
Recently, the Monetary Authority of Singapore released proposed guidelines to facilitate FinTech services. With these guidelines, PoC testing aims to achieve practicality, whilst issuing and settling cheques through blockchain technology on a system developed by Hitachi Asia Ltd. within the Asian region.
Read more about the PoC testing of blockchain technology in Singapore, via MUFG, here.