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HSBC intends to use blockchain technology to enhance the KYC process for local investors and corporate clients.
HSBC, the world’s largest bank, has announced that it has been successfully onboarded to the regional Know-Your-Customer (KYC)-focused private blockchain sponsored by the government of Dubai.
HSBC is the first foreign bank, and the fourth founding member, to go live on the “UAE KYC Blockchain Platform,” established by the Dubai-based Department of Economic Development, called “Dubai Economy.”
The UAE KYC Blockchain Platform is a national ecosystem for the exchange of verified know-your-customer data between licensing authorities and financial institutions in the United Arab Emirates.
According to the Gulf News, HSBC’s addition to the platform provides investors with the option of digitally opening an account with the international bank using data that has already been verified by another bank via the blockchain.
Dubai Economy’s director of development, Omar Al Mehairi, praised the platform for offering efficiency savings and improving the overall business climate in the UAE, stating:
“The UAE KYC Blockchain Platform has transformed the investor bank account journey by significantly reducing the time it takes to establish relationships with banks. This will positively improve UAE’s ranking in the global Ease of Doing Business index.”
The technology, which was launched in February 2020, enables banks to reroute the process of identity verification, which can be time-consuming and costly when done traditionally.
Emirates Islamic, Emirates NBD, Commercial Bank of Dubai, Abu Dhabi Commercial Bank, RAKBANK, and Mashreq Bank are among the main local banks and financial institutions that have joined the KYC Blockchain.
The Middle East aspires to be a digital banking hub, with Dubai at the epicentre. Cointelegraph revealed in March that the Dubai Financial Services Authority (DFSA) was working to provide a uniform framework for cryptocurrency laws in the city.
However, officials issued a warning in May about Dubai Coin, a cryptocurrency that claimed to be the “official digital currency of Dubai” but was never approved.