CB successfully completes blockchain technology-based shared KYC POC

The report of the blockchain technology-based shared KYC POC was presented to Central Bank Governor Ajith Nivard Cabraal by National Payment Council (NPC) Chairman and Central Bank Deputy Governor Yvette Fernando, on October 25, 2021, amidst the attendance of the Central Bank management and officers and virtual participation of CEOs and officers of banks that engaged in POC testing and the three POC development teams. 
Previously, the Central Bank had selected three applicants to develop the POCs, namely, Sampath Bank jointly with University of Colombo School of Computing (UCSC), Yaala Labs (Pvt.) Ltd, jointly with Linearsix (Pvt.) Ltd and Norbloc AB from Sweden. 

The POCs were tested by the Central Bank and 10 commercial banks viz. Amana Bank, Bank of Ceylon, Cargills Bank, Commercial Bank of Ceylon, DFCC Bank, Hatton National Bank, HSBC, National Development Bank, People’s Bank and Standard Chartered Bank. 

The POC deployment and testing phase was successfully completed in June 2021. 

The findings demonstrated several salient features of blockchain technology that enabled secure and efficient sharing of customer KYC information between banks. In fact, this was a pioneering national project initiated by the Central Bank that drew the voluntary participation of the banking industry and the information technology industry to collaboratively explore the potential of blockchain technology to enable innovations in many financial services. 

The purpose of developing a blockchain technology-based POC of an industry-wide shared KYC process was to assess the potential to improve customer experience, lower operational costs and reduce the operational risk of banks and other financial institutions. It is expected that digitalisation of the KYC process, especially with user-friendly and secure designs, would encourage customers to use digital financial services and increase their access to financial services. 

The successful completion of the blockchain technology-based shared KYC POC signifies an important step in Sri Lanka’s journey towards digitalisation of financial services as well as increasing access to financial services.