She Builds Hackathon
The idea for the project is to build a lending application using Blockchain. Using this application, people would be able to take loans on the blockchains. That means they can essentially lock up certain assets and borrow other cryptocurrencies and then pay back later after a certain amount of time. A different use case for this kind of application is cryptocurrency trading. Traders can lock up certain cryptocurrency assets to borrow a different kind of asset, then trade it and make a profit. Blockchain technology-based lending provides a solution as it is based on a peer-to-peer model and can make the entire process smoother and safer leading to obsoletion of traditional banking system and third parties. A borrower sitting in any part of the world can access the loan market and lenders can bid to deliver it due to the decentralized nature of blockchain technology as geography is not a concern in it. Overall, blockchain technology adds transparency, reliability, trust in this complex lending process which will reduce parties’ risk and decrease settlement delays.
Blockchain technology has proved to be useful in many fields like cross-border payments,trade finance, settlements and consumer lending is also a sector which can benefit immensely from it. Here’s how blockchain can help consumer lending industry:
- Low Operational Risks
- Improved Servicing Efficiency of Loans
- Identity Authentication
- Flexible Markets
The concept of blockchain based lending might bring in a new era in the lending business as automatization of loan agreements can vastly improve the process, but blockchain technology itself is in its nascent stage with a lot of new updates every day.Automatization of evaluation of customers and finding their credit scores require robust oracle systems, which at this point are in their development stage. Many consumer lending companies are in there planning stage at this point of time except a few early adopters. But, blockchain technology is the technology for future and it lays groundwork for great transparency and efficiency in lending environment and analytics give the firms the edge they need to convert this transparency into decision making, This new version of age-old peer-to-peer lending system has the potential to completely revolutionize financial lending by adding accuracy and efficiency to the outdated centralized system.