DES MOINES, Iowa—Blockchain technology continues to make inroads into financial services, which is why TMG said it is partnering on a study to determine the applicability of blockchain for FIs, including credit unions.
TMG and its strategic partner, CO-OP Financial Services, are working with Mercator Advisory Services on the study.
The study comes on the heels of nine of the world's biggest banks—including Goldman Sachs and Barclays—partnering with New York-based financial tech firm R3 to create a framework for using blockchain technology in the markets. The move that marks the first time banks have joined to work on a shared way in which the cryptocurrency technology beneath bitcoin can be used in finance.
“It’s interesting to see the wide range of possibilities being explored for distributed ledger technology,” said TMG CEO Shazia Manus. “At this early stage, it seems distributed ledger technology’s greatest contribution to the financial industry will be around transparency and security.”
'Single Source Of Truth'
Manus said the idea of relying on a blockchain as the “single source of truth” for identity management is compelling.
“Imagine a world in which you really are the only owner of your personal information. No one can sell it, steal it or duplicate it without your permission,” she said. “This is just one example of a distributed ledger use that could have a dramatic impact on the way credit unions authorize everyday financial transactions.”
Shazia Manus, TMG
Manus said that TMG, CO-OP and Mercator will work together to identify viable blockchain use cases for the regulated financial institution industry.
“Similar assessments are happening in so many different industries, from healthcare to state government,” said Manus. “As a passionate advocate for looking beyond our circles for inspiration, I’m personally excited to see how entities outside the financial world use technology like blockchain to transform business.”
The issue of identity management and authentication are going to be big drivers of innovation in the near term, asserted Manus.
“We see a lot of interest from consumers and financial institutions alike in the use of biometrics. We are also hearing a lot of discussion about universal identity and whether the financial institution can or should be the trusted keeper of our identity data,” Manus said.
Beyond Typical Analytics
Turning to data analytics, Manus said analytics will come into “clearer focus” for more credit unions this year, especially as they approach planning and budget season.
“Those on the forefront of big data will be pushing their teams to go beyond the typical analytics,” Manus said. “There will be a growing desire to see more than what has already happened. They’ll be looking to build the infrastructure and the skill set to derive predictive and prescriptive strategies from their data—and the data of others. No longer is ‘what happened’ going to be enough. Savvy leaders will want to see what is about to happen, and even better yet, what they can do to make it happen.”