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Top 7 facts about the new Interswitch Block Chain Service (Supply Chain Financing Module)

Interswitch

Interswitch

The demand for blockchain-based services is on the increase globally, while the technology powering these services is growing at a rapid pace. The potential applications for blockchain technology are almost without limit. However, in Nigeria, there are still lots of misconceptions, doubts, and fears surrounding this technology.

A blockchain is a secure, shared distributed ledger. The deployment of blockchain technology ranges from digital wallets, identity management, cross-border trades, to remittances and supply chain finance.

Recently, foremost integrated digital payment and commerce company, Interswitch Group, in partnership with Microsoft Corporation, announced the launch of its innovative blockchain-based supply chain financing module. The Interswitch Blockchain Service (Supply Chain Financing Module) is built and hosted using Microsoft’s Azure blockchain technology which provides a proven security, compliance and scalable cloud platform that accelerates and supports the next generation of blockchain applications.

On this week’s edition of Product Review, we feature Top 7 Facts about this revolutionary new service, one of only four of its kind worldwide:

What Problem the Interswitch Blockchain Service Is Designed To Solve

This innovative platform was conceived to create a framework that allows for the speedy execution of contracts requiring bank guarantees, in a secure and transparent manner, for SMEs.

Prior to the launch of the Interswitch Blockchain Service, small businesses seeking financing to execute supply contracts, would usually spend an average of three months to secure bank guarantee and even get turned down eventually due to the lack of available verifiable funding history.

To solve this problem, the new platform digitizes the process between corporates and banks in providing trade financing to entrepreneurs and business owners in the supply chain sector. The service allows only the intended parties access to a supply chain transaction process with the different stages involved – from the bank guarantee request to approval, up to tracking the repayment by the customer.

The service also helps in streamlining the internal processes within the corporates and banks, which amount to the lag time responsible for the delay in processing these financial instruments. The platform will provide visibility for the different stages of a transaction to the repayment by the customer, reflecting the customer’s credibility by showing history and

performance of the business. This means that a credible customer will have easy access to financing based on his credibility.

The Unique Value Proposition Of The Platform

The Relationship Between Blockchain and Cryptocurrency

People often confuse these two terms. Cryptocurrencies are digital currencies that make use of blockchain technology to record transactions and are used to pay for digital goods and services, while blockchain is the underlying technology that enables recording of the transactions among different connected entities.

A good analogy is likening the blockchain technology to the Internet. While blockchain is the Internet whose technology enables functions such as Whatsapp, email, browsing etc, cryptocurrency will be seen as the Whatsapp functionality. What this then means is that blockchain is the overarching technology that enables these functions, while cryptocurrency is just one of the functions enabled by blockchain. So the Interswitch Blockchain Service is not a form of cryptocurrency!

How Business Owners And MSMEs Can Use The Platform

The small or medium sized business owner can access the technology through his/her bank (account officer). However, the small business owner is required to have an email address to which notifications and progress of operations updates are sent. Although this is not a mandatory requirement, it allows for easily monitoring by for the small businesses involved.

Benefits to Business Owners and MSMEs

How This Service Benefits The Nigerian Economy

This new service will allow more entrepreneurs to have access to finance, hence allowing them to scale their businesses. The cumulative effect of this can lead to more jobs, thereby driving economic growth for the country.

The Commendable Partnership Between Interswitch and Microsoft

The Interswitch Group, founded in 2002, is an Africa-focused integrated digital payments and commerce company that facilitates the electronic circulation of money, as well as the exchange of value between individuals and organizations on a timely and consistent basis.

On the other hand, Microsoft is an American multinational technology company with headquarters in Redmond, Washington, where it develops, manufactures, licenses, supports and sells computer software, consumer electronics, personal computers, and related services.

Both companies share the same goal of providing infrastructure and technology to make life easier for their customers.

According to Interswitch, it intends to build a PAN African Payment network using blockchain technology to solve some of the cross-border trade and peer-to-peer money transfer challenges across Africa.

The Microsoft Azure platform provides a very secure platform and as a testimony to this, all banks and major corporates are already using Microsoft Azure today.

With this partnership, Interswitch will leverage the technologies provided by Microsoft to empower all its customers across Africa.

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