Israel's largest bank is working with software giant Microsoft to develop a blockchain-based platform for creating digital bank guarantees.
According to the Times of Israel, Bank Hapoalim – the country's largest by assets – will look to digitize the largely paper-based process. Reportedly involved in discussions around the launch is the Bank of Israel (the nation's central bank).
Arik Pinto, Hapoalim's CEO, said in a statement:
"The new process will enable Bank Hapoalim customers to receive security documents in a digital, automated and secure manner, without physically coming to the branch and in a very short process. The use of blockchain technology will significantly improve the customer experience and the level of trust in the banking system."
The project is being built on top of Microsoft Azure, the tech giant's cloud computing service that has served as the hub for its work with blockchain.
"This is the first collaboration of its kind in Israel in the banking sector that will enable a digital revolution, access to advanced services and the combination of technology and business needs," Shelly Landsmann, chief executive for Microsoft Israel, said of the initiative.
Other banks have explored moving bank guarantees – which are essentially promises to cover the principal on a loan in the event of a default by the borrower – to blockchain-based systems, including Australia's Westpac.
Bank Hapoalim image via rasika108/Shutterstock