Blockchain will be used for housing and utilities payments

Credit: Natalya Seliverstova | RIAN

Russia’s Alfa-Bank has developed an innovative IT solution that would transfer operations with utility payments to the blockchain.

According to CNews, the solution is based on the open source blockchain platform Corda from the R3 global consortium. Kvartplata 24, a cloud service for paying utility bills, has partnered with the bank to develop the system, which took about six months. The new blockchain solution services utility payments using the distributed registry technology. Technically, the system is a b2b platform; this means nothing changes for the payers of utility bills, including private individuals. At the same time, banks, building management companies and other entities will benefit enormously from the blockchain solution. The new system is expected to simplify interaction with utility service providers, and, most importantly, to increase transaction transparency and eliminate intermediaries.

According to the project initiators, the use of blockchain will also help reduce arrears on utility payments, simplifying and speeding up the transfer of money.

The blockchain technology is undoubtedly suitable for managing payments for services and meeting the information needs of the housing and utilities sector in general, says Igor Pavlov, head of the Waves Node development team.

“The payment process typically involves several parties: the housing and utilities service providers, the consumers, the clearing centers and the payment operator banks. Such a long chain cannot rule out errors. But, where mistrust is possible between the parties, the blockchain works fine, recording everything that happens reliably and transparently, while smart contracts ensure the fulfillment of conditions exactly as they were agreed upon,” Pavlov said.

The blockchain will undoubtedly continue to be used in all new areas, the expert believes. For example, when selling tickets to major sporting events, the technology can help rule out reselling and profiteering.

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