Blockchain is a technology that can is also known as internet 2.0 or web 3.0. This is something that is here to stay. In order to know about blockchain technology, you will need to first know about the underlying technology behind bitcoin. This is expected to disrupt several different redundant backend procedures that will result in building customer trust and bringing in more transparency.
In fact, according to research it is expected that blockchain technology will rule 2019 widely. As this technology matures, more and more companies will gain more attention from the relevant stakeholders of the ecosystem. This means that after using blockchain, there will be no looking back for tech startups.
There are several blackchin startups that operates as a private platform based on Quorum. This platform actually lest the lenders to access any potential borrower data having data privacy in mind.
The inception of blockchain technology
The blockchain technology was in the picture since 2017 and as eyeing the money lending industry.
- The blockchain companies and their initial coin offers an experience that is deepened by the knowledge of blockchain. This has enabled the lenders to understand how to work around this specific technology.
- It is also found that it was during this time that the blockchain companies started to target the money lenders in the US market.
This is because they realized that there is a huge demand for a decentralized marketplace wherein data could be shared easily and privately without any need to compromise with the security.
Blockchain seems to be the most obvious and effective solution to this business problem that is pretty known to all but was not solved till the arrival of blockchain.
With the help of the current technologies and the centralized systems, it is no more difficult to solve, though here are some more researches and due diligence required to be done around the blockchain.
All about data security
In simple terms, blockchain platform is all about data security because this is a permission system where only the authorized and known parties are allowed to access specific data. However, use of blockchain technology does not mean there is need to change the entire lending process. Instead, the platform will help the lenders to do what they are currently doing only in a much more effective and efficient manner.
This is in fact the technology facilitator that will help the money lenders such as LibertyLending.com or others to use their customer data much more efficiently and in a better way so as to pitch their loan products across the wider spectrum.
If you take a look at the US market over the domestic market, you will see that the former is the more matured marketplace as compared to all other money lending markets of the world. According to a survey of Techpreneur it was noted that:
- The credit scoring system in the US is much more advanced as compared to the world markets wherein the levels of penetration are poor and additionally
- The processes followed here are not standard which makes it more difficult to operate on any decentralized platform.
If you look at 2019, blockchain companies plan to continue expanding its operation and service in the US market and also try to find out other new shores to conquer.
Considering the fintech companies
If you now take a look at the fintech startups and investors, you will see that they are more inclined to use this technology. This is because they have seen the huge potential of it in money lending.
Ideally, the lending market segment today is being driven towards what can be rightfully termed as lending 3.0 which is typically the next-generation lending. Thanks to the ongoing digitization, today borrowing has become much easier than it was before. In fact, due to the liberal lending policy, it is as easier as it can get.
- When you compare the lending process of the olden days with that followed now, you will see that most of the jobs a completed just by a few clicks of the mouse or by touching a few buttons on your smartphone touchscreen.
- In addition to that, you will need to answer a few verification-related questions which when answered satisfactorily will result in the approval of the loan and the amount disbursed in a matter of hours or days, if not within couple of minutes.
The best part is that you can get all these without having to go into any hassles of pledging any collateral. You will get the loan being in the comfort of your home.
That means you are saved from several thongs that you would have required to do in case you wanted to take out a loan from a traditional bank such as:
- Taking a day off to visit to the bank
- Do extensive paperwork and
- Visit the bank frequently to check the progress of your loan application.
Most importantly, you will not have top anticipate that your loan application does not get rejected simply due to the misjudgment of the loan officer.
All these can take a lot f time, often ranging to two to three months and add to that the visits to that banks that will account for multiple days off from your office.
Therefore, it is beyond any question that the advent and rise of the fintech startups has been a boon for the borrowers that has literally altered the game of money lending across several markets in the US and all over the world.
Therefore, it can be concluded that both blockchain technology and the fintech startups have made money lending and borrowing much simpler and convenient. It is all due to their revolutionary approaches that is basically driven by the state-of-the-art technologies.
As of now, there are more than 1,500 fintech startups of different shapes and sizes are catering to the US market, and most of these, in fact half of these have come to the existence win the last couple of years, indicating the lucrative ecosystem.