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Posted: 19 December 2017

Billon helps the Polish banking sector to save hundreds of million zlotys

Five Polish banks are the first in the world to publish documents in the blockchain-based durable media system developed by Billon. The system is used to store documents, such as price lists and terms and conditions, and deliver them to clients in an immutable and regulatory-compliant form. Thanks to the application of this technology and the reduction of costs required to provide information in an unchanged form, the banking sector in Poland can save almost PLN 500 million annually.

Polish universal banks serve about 48 million customers annually[1]. Each of them updates their regulations, price lists or other important documents several times a year and needs to inform clients about those changes. Assuming that the bank must provide customers with information once a quarter, and the cost of mass-mailing is about PLN 1-2.5 per letter, total costs of the banking sector related to informing customers about document changes range from 200 to even PLN 500 million annually.

In March 2017, the President of the Office of Competition and Cosumer Protection in Poland (UOKiK) issued an opinion that an e-mail does not exclude the possibility of interfering with the content of correspondence. According to UOKiK, such a guarantee is provided by a paper correspondence or other solution that meets the regulatory requirements of the so-called durable medium. Banks in Poland must adopt that decision no later than in 2018. By using Billon's blockchain technology for this purpose, the Polish banking sector will not only cut costs of corresponding with clients, but also of IT security related to data protection. The cost of solving only one security incident can amount to as much as PLN 3.5 million.[2]

The first blockchain-based banking compliance solution

Since the last spring the Association of Polish Banks has been working on the sectoral-wide durable media solution for storing and delivering important documents by banks to their clients. As a part of that effort, Billon and the Polish Credit Information Bureau (BIK) signed a contract for a pilot implementation (so-called proof of concept), which aims to show the capabilities of  Billon blockchain technology capabilities and develop a joint solution that can be quickly implemented in the entire banking sector. As part of the pilot, from Tuesday, December 12, five Polish banks publish non-personalized documents (regulations, fee tables, etc.) in the durable media system provided by Billon . Other financial institutions and enterprises from other sectors may join the tests before December 20. The implementation of the solution takes only a few hours.

After collecting opinions of the banking sector, Billon and BIK plan to implement a commercial solution in February 2018. Polish banks may use blockchain technology for regulatory purposes as the first in the world. Billon also conducts talks about implementing similar solutions forthe banking sector in other countries.

Andrzej Horoszczak, CEO and founder of Billon. "One of the main advantages of our technology is that it is licensed. This means that - unlike in many cases of an "open source" software - there is a team that regularly works on it. We are able to present a specific direction of product development and systematically develop new functionalities, as well as respond to customer needs and questions. In this way, we become a safe and reliable business partner who has control over what he creates, as well as uses clearly defined support procedures in case of problematic situations."

The most secure durable media solution

The blockchain developed by Billon, as opposed to competing solutions, is the only one that is able to save not only hash addresses, but whole documents, in a distributed form. Therefore it completely eliminates the need to maintain expensive and vulnerable servers. Documents are saved in the form of distributed fragments stored in a network created by various devices. In order to find and combine them, a unique blockchain address is required, which is exclusively in the possession of the institution publishing the document and the client who needs it. Even if the blockchain address has been obtained by another entity, it will not be able to read any data, as it has no access to all the fragments of the document. In addition, each document is encrypted with another key.

In accordance with the EU legislation, durable media must ensure that there is no technical possibility to modify or delete stored data by any of the parties. Andrzej Horoszczak: "The unprecedented guarantee of data retention comes from the distributed architecture of our system, not from fallible procedures. Documents are entirely outside the IT system of the institution. Any modification of them is not possible without the client's consent. If someone still wants to modify the documents, this action will be automatically detected."

Documents are entirely outside the IT system of the institution. Any modification of them is not possible without the client's consent.

Andrzej Horoszczak, CEO and founder of Billon

Billon's durable media technology also meets the requirements of GDPR, including "the right to be forgotten". In specific situation and with the consent of a client, encryption keys can be destroyed, making access to specific documents permanently blocked.

The blockchain solution developed by Billon is very customer-friendly. It strengthens the position of customers in relation to the bank, because it technologically prevents the bank from deleting and unilaterally changing the document. The solution gives users easy access to their documents from any location using a smartphone. The system can be fully integrated with al the widely used forms of client communications, i.e. push messages from the mobile application, messages from the dedicated Billon application, SMS notifications or e-mail. Billon's blockchain can also store documents created by other institutions, e.g. medical records, electricity consumption indicators, phone bills, or notarial certificates.


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