2018 Technology Trends for Shared Services: BlockchainAdd bookmark
Shared Services Technology Trends: Payments
The year 2018 is a year of technological breakthroughs and disasters. Various new and highly promising technologies are currently being tested in organisations. Technological advances such as Quantum computing and blockchains have started to penetrate corporations' business processes and infrastructure. Technological disasters such as the 'Spectre' flaws in the Intel processors are significant harbingers to information security for companies. These long-term trends will have an impact on Shared Services operations around the world. In this article, we will discuss the technological trends for 2018 in payment systems, which will affect shared services.
While bitcoin and blockchain were grabbing the headlines in 2017, most of the headlines focused on the speculative nature of bitcoin and how the various exchanges have come under pressure from the regulators. In 2018, the direction of discussion for blockchain will change from the application of blockchain to the development of practical blockchains that can efficiently solve real-world problems. Recent advances address some limitations of blockchains, but there are other limitations that remain to be resolved. However, blockchain applications are beginning to mature, and Shared Services Organisations can consider adopting the technology to improve process efficiency.
As blockchains are designed for payments, the ideal starting point will be in the payment processes.
Every aspect of the payments cycle is open to disruption. The optimal processes to adopt blockchains are payment clearance and payment contract. Most payment processes consist either of manual paper processes or file/e-documents exchanges involving multiple parties. The payment lifecycle comprises of several steps that require both internal and external parties to process the payments. This cycle takes days to complete, and any exceptions or errors will further delay the process. As a result, companies monitor their bank account to establish when payment has been made or received.
The distributed ledger nature of blockchain establishes the pre-requisite of connecting all the parties in a financial transaction in real time and simultaneously. This feature opens up the possibility of processing the payment across all sides at the same time while supporting an audit trail. As the processing is distributed over the network with various independent parties verifying the transaction, any attempt to alter or manipulate the data is challenging, hence reducing the chances of fraud or security breaches.
As the possibilities of blockchain's applications increase, the options for Shared Services Organisations increase, too. With the improvements to blockchain technology, applying blockchains in Shared Services is fast becoming a reality.
In future, payments processing and contract creation will be accomplished in real time, and delays and payment issues that drive inefficiency will be a thing of the past.