Sirlibz
(Tony for you : Please is there a way you could increase the title to cover it fully : IRTI partners with Samsung-backed Blocko E24P to build Blockchain Based Credit System. )
The research arm of the Islamic Development Bank Group (IsDB), IRTI has come into partnership with Blocko, a Samsung backed Blockchain technology firm.
The Islamic Research and Training Institute (IRTI) and Blocko have collaborated with the aim of building an innovative blockchain based smart credit management system.
The collaboration between IRTI and Blocko comes as part of the E24P initiative, a newly launched technology group focused on delivering cutting-edge blockchain technology across Africa and South-East Asia (Middle East).
The need for the technology
The Law (Sharia law) prohibits Islamic banks from charging borrowers interest or penalizing them when they fail to pay up on time. So in order to encourage debtors to meet up with the payment, they are charged with fees which are then donated to charity when paid. This means however, comes with its own challenges, for example debtors do not feel the urgency to pay back funds borrowed, some even see the late fee as an act of benevolence. The banks also face the difficulty of efficiently distributing this funds to charity, plus they don’t earn any incentives which makes it lack development.
Solution: An Open, Secure and Transparent System
The smart credit management system will be developed on the Aergo hybrid blockchain, this system will enable not only Islamic banks but other financial institutions to perform credit assessments in an autonomous and integrated way while still maintaining transparency, security and privacy.
Speaking on this new technology and partnership, Dr Sami AI Suwailem, Director General of IRTI said
“The Islamic finance market is growing rapidly, with projections of a rise from around $2 trillion to an impressive $3.78 trillion by 2022, yet certain technical and economic challenges have prevented the industry from truly flourishing. Our new partnership with E24P aims to address this by providing the infrastructure needed for the Islamic financial industry to deliver critical financing to both the developed and developing world”
Once integrated, Creditors will be able to reduce their credit default rate in a transparent manner while keeping the data and methodology used appropriately secure and confidential and this too utilizing the Zero-Knowledge proofs.
Zamani Phil, the CEO of E24P stated that the systems will help banks “deliver a truly unique solution that has the potential to have a significant impact on the world of Islamic finance.”
