Thursday, 29 March 2018

Polish bank begins using a blockchain-based document management system

A blockchain company called Coinfirm has announced a partnership with PKO BP, a major Polish bank, to provide blockchain-based document verification using a tool called Trudatum. The project is a an actual implementation of one of the primary benefits of blockchain-based tools, namely its ability to permanently and immutably store data. This announcement brings blockchain implementations out of the realm of proof-of-concept and into the real world.

“Every document recorded in the blockchain (e.g. proof of a transaction, or bank’s terms and conditions for a given product) will be issued in the form of irreversible abbreviation or hash signed with the bank’s private key. This will allow a client to verify remotely if the files he received from a business partner or from the bank are true, or if a modification of the document was attempted,” wrote the Coinfirm team.

Coinfirm founders Paweł Kuskowski, Pawel Aleksander, and Maciej Ziółkowski have experience in cryptocurrency and banking and they bootstrapped the company over the past two years. They also run a blockchain-based AMC/KYC platform for investments that is reaching the break-even point. They entered the world of blockchain after becoming frustrated with banking but the industry sucked them back in.

“Together with Pawel Aleksander we decided to leave the banking world as we saw that the AML process in the financial industry is broken – it’s very arbitrary, takes thousands of people, and has a very low efficiency,” said Kuskowski. “Our early observation of the digital currency space and it’s challenges showed a huge need for AML solutions. Also because of the nature of the ledgers we could create a data driven machine-learning based software as opposed to the people-based process prone to human error and subjectivity that is the standard for the banking industry. Once we understood the blockchain technology better we continued to launch new products that are using it to solve compliance challenges – starting with the Coinfirm AML/KYC Platform, and then Trudatum.”

The Trudatum tool essentially allows PKO BP to create “durable media” – “a digital solution for storing all agreements with clients that is now required by the law.”

“Every document recorded in the blockchain (e.g. proof of a transaction or bank’s terms and conditions for a given product) will be issued in the form of irreversible abbreviation („hash”) signed with the bank’s private key. This will allow a client to verify remotely if the files he received from a business partner or from the bank are true or if a modification of the document was attempted,” said Kuskowski.

For their part, PKO BP is pleased with the pilot project, making it one of the first European banks to publicly admit that they’re using a blockchain tool for document management.

“Coinfirm is one of the startups that we discovered thanks to the ‘Let’s Fintech with PKO Bank Polski’ acceleration process,” said Adam Marciniak, a Vice President at PKO BP. “It already has considerable experience in blockchain technology acquired in several countries. Last year we started tests of the Trudatum platform developed by Coinfirm. As tests in the banking environment were highly satisfying, we decided to cooperate more closely. We believe that together we will be able to carry out a pioneering operation of implementing blockchain technology into the Polish banking sector.”



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