A consortium of Australian financial companies has teamed up with IBM and shopping center operator Scentre Group to launch a pilot project to provide bank guarantees on the blockchain.
The Lygon project, launched on July 3 with the participation of ANZ, Commonwealth Bank and Westpac, will collect and digitize data from the Scentre Group tenant test group across Australia. Firms hope that the Lygon platform will reduce the time required for banks to issue guarantees by one day. A similar test can take up to a month using traditional processes.
The supporters of Lygon claim that digitization reduces the risk of fraud and errors in the issuance of banks’ guarantees of billions of dollars. All Australian retailers need a bank guarantee to get such a lease and operate their stores.
Depending on the success of the pilot project, Lygon will provide access to the platform to all banks, lease applicants and beneficiaries. The five founding members also plan to expand technology research in other industries.
The Lygon project is another blockchain-based system created specifically for bank guarantees. Last December, Fintech Association implemented
the project “Digital Bank Guarantees” based on Masterchain. In addition, Standard Chartered and Siemens announced last summer that they would place bank guarantees on the blockchain.