Barclays Bank begins blockchain project in Africa

Rage Comment: With the popularity of M-PESA in Africa, many people have begun to realize that Internet finance may be able to develop faster in places where financial infrastructure is relatively backward. Since there are no large traditional financial facilities and complex regulatory regulations in Africa, Internet finance can achieve leapfrog development. Therefore, we can see that Barclays Bank in Africa has high hopes for the development of blockchain technology in Africa and tries to cooperate with blockchain companies at the first time. In addition, although Barclays Bank is a very old financial institution, they have invested in multiple blockchain start-ups and have begun to apply blockchain technology to actual business.

Translation: Annie Xu

African banks have been slow to jump on the fintech bandwagon, but after a surge in the number of customers getting financial services from telecoms companies, most notably Kenya’s Safaricom’s M-Pesa platform, they are starting to see Africa as a testing ground for new financial technologies like bitcoin and blockchain.

Blockchain has become a hot topic in new fintech hubs such as Johannesburg-based Rand Merchant’s AlphaCode, which hosted December’s Afrikoin conference and manages a fintech accelerator, and Cape Town-based Barclays Rise, which will host the Fintech Africa Blockchain Conference on February 25.

Barclays, which is 62% owned by the British company Barclays, operates in 13 African countries. It is hoped that the accelerator managed by Techstars, an American company open to clients, will bring in new ideas that the 300-year-old bank cannot achieve on its own.

Warren Squires CIO: Barclays Seeker Fund

Warren Squires of Barclays Ventures Africa said:

Emerging companies can build new systems faster, they can solve problems that other banks cannot, they are free of red tape and have a broader view of the world.

Barclays’ first blockchain collaborator in Africa was Consent, which took a full look at the first accelerator in Cape Town in late 2015.

Shaun Conway, one of the founders of Consent, said:

Barclay is trying to define his future as if he were going through his own midlife crisis.

While Consent is initially using blockchain technology to improve the reliability of personal medical record databases, Shaun Conway has predicted that Barclays could use the technology for short-term customer profiling (KYC) and long-term protection of customer identity information.

After the accelerator, Consent landed a $100 million, one-year contract with Barclays to build an analytical proof system for the bank.

Barclays has cooperated with many blockchain start-ups around the world, with a particular focus on the African market.

Arian Lewis, Head of Open Innovation at Barclays, said:

Blockchain technology may become the social and political innovation with the greatest impact on Africa in the next 100 years. If digital currency is applied to African countries, corruption in their governments will be greatly reduced, and citizens will gain more control and political transparency. The digital economy based on Bitcoin and blockchain can make African leaders more reliable.

But recently, a view on blockchain has caused some controversy. They believe that in addition to being a cryptocurrency, blockchain has a wider application as a general ledger.

Marcus Swanepoel CEO: BitX

Marcus Swanepoel, chief executive of BitX, a new South African startup, argued in “Beyond the Blockchain”:

Blockchain technology itself is not the magical brilliance of the sun that people expect.

Marcus Swanepoel said:

People believe that rashly applying blockchain technology in real life will endanger the survival of the trading parties.

He added:

Like options, diamonds or stocks. You effectively tokenize something. But you still need to trust that the person who tokenized it actually owns the asset. There may be fraud when people upload things to the system, not fraud in the system itself. Bitcoin itself has collection and transaction value, and there is no transaction risk, so it is particularly influential in Africa.