Spanish stock market BME has teamed with Renta 4 Banco to launch the first test of using blockchain to remove the need for physical certificates for the collateral pledge process.
The proof of concept test saw the replacement of physical certificates in the process with a digital process, with the blockchain being used to ensure all the participants had access to related information in real time.
BME said the experiment led to a more than 80 per cent reduction in end-to-end process time, as well as boosting operational and risk management through direct access to the live data.
The test involved BME subsidiary BME Clearing, the Spanish central securities depository IBERCLEAR and Renta 4 Banco as the pilot firm.
BME head of digital transformation Berta Ares said, “DLT technology allows us to reduce times drastically and improve the operation and control of the system, providing legal certainty for electronically generated certificates and maintaining privacy and compliance with the General Data Protection Regulation.”
Teresa Sánchez Alonso, head of IT systems at Renta 4 Banco, added, “This innovation project is aligned with the strategy of digitisation, automation and continuous improvement of Renta 4 Banco’s customer service.”
BME and Renta 4 Banco said they would keep working on the developments necessary to allow the system to go live by the end of 2019.
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