Emirates Islamic, which sees Emirates NBD – Dubai’s largest banking group – as its parent, becomes the first Islamic bank in the United Arab Emirates to introduce blockchain technology for customers’ cheque books. Cheques remain a popular payment method in the region.
Cheque Chain was first announced in early May by Emirates NBD, with the initiative underlined as the “beginning of a significant strategy by Emirates NBD to integrate blockchain technology into existing products and services. As reported by CCN at the time, an initial phase of the project saw unique QR (quick response) codes on every leaflet of the blockchain-powered cheque book. Each QR code will register every cheque on to the bank’s blockchain, allowing it to validate the cheque’s authenticity at all times. Emirates NBD began issuing the new cheque books to its own employees in a pilot phase.
This week, Emirates Islamic announced the issuance of new QR-enabled cheque books, ‘along with a string of 20 random characters’ to its customers.
Suhail Bin Tarraf, chief of operations at Emirates Islamic stated:
Blockchain has the potential to significantly increase security and protection in banking transactions…We anticipate that Cheque Chain will dramatically reduce cheque frauds in this market helping us provide our customers greater peace of mind and security.
Details of the blockchain technology remain unknown but the next stage of the Cheque Chain initiative will see the bank register each cheque leaf on its blockchain platform to validate the authenticity of the cheque at its source.
A similar effort is taking shape in Singapore, where Japan’s largest bank, MUFG, is using Singapore’s FinTech-forward regulatory sandbox to issue, transfer and collect electronic cheques on a blockchain, as way to digitize the traditionally paper-only process.