IBM Cuts Credit Unions Deal For Blockchain Services In $1.7 Trillion Industry

in #blocktrade6 years ago

IBM and Denver-based credit union service organization CULedger, have struck a collaboration deal by which new blockchain-based services will be pioneered to help credit unions provide their members with greater efficiencies and an enhanced user experience. CULedger focuses on delivering “innovative applications” to credit unions via its cross-border global distributed ledger platform.

Specifically, IBM and CULedger, a consortium of credit unions, are to work together to use permissioned blockchain technologies to create an immutable audit trail, which can be used to create new business models and transform existing business processes for credit unions.

The parties also intend to help foster “greater financial inclusion” by extending the reach of services to a broader range of new members.

History of Credit Unions

Globally today there are over 260 million members belonging to credit unions, financial co-operatives that provide savings, loans and a range of services to their members, with circulating assets put at more than $1.7 trillion in 105 countries.

Owned and controlled by these members who use their services – not by external shareholders or investors – each member has one vote and volunteer directors are elected from the membership – by the membership.

As such and historically they are known for providing superior customer service – rather than being driven by maximising profits. They also come in all shapes and sizes, and can offer services spanning online/phone banking, payroll partnership with your employer and providing credit at competitive rates.

In the United States (U.S.), credit unions can either be chartered by the federal government or a state government. And, as of 2016 there were 5,757 credit unions with almost 104 million members comprising 45.4% of the economically active population. Credit union leagues exist across America in the shape of the Association of Vermont Credit Unions, California and Nevada Credit Union Leagues and Ohio Credit Union League.

Across the Pond in Britain the first credit union start trading back in 1964, and over the last 50 or so years, they have grown to provide loans and savings to more than 1.2 million people across England, Scotland and Wales.

Banks vs. Credit Unions. Pros and cons scribbled on a blackboard. (Photocredit: Getty).GETTY
Blockchain & Credit Unions

The collaboration with ‘Big Blue’ – IBM – follows CULedger becoming a member of the enterprise software firm R3’s global blockchain ecosystem last December.

It joined R3’s global network of over 200 of the world’s largest financial services firms, technology companies, central banks, regulators, and trade associations working together on R3’s Corda platform, which is already being used in industries spanning financial services, healthcare, shipping, insurance and others.

Since 2016, IBM has worked with a wide variety of clients across financial services, supply chain, government, retail, digital rights management and healthcare sectors to implement blockchain applications. And, today it operates a number of networks in this space that are running live and in production, around 1,600 staff working in blockchain and DLT across all areas and sectors.

Highlighting some of ‘Big Blue’s endeavours in the space, in April 2018 IBM became a “founding Steward” of the Sovrin Foundation, a Salt Lake-based private-sector international non-profit organization that utilizes the power of a “hybrid” distributed ledger (blockchain), to stem fraud and address the current centralized identity system that costs individuals and businesses billions of dollars every year.

Prior that in January 2018, Danish business conglomerate A.P. Moller- Maersk and IBM sealed plans to form a joint venture based in New York to provide more efficient and secure methods for global trade using blockchain technology. And, in December 2017 Big Blue was part of a consortium with Walmart and China’s JD.com amongst others to launch a food safet

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