For a completely digital economy, it becomes very favorable when a huge number of people start using digital cash. This leads to the development of new payment methods to encourage digital transactions. Although, standardizing the shape and functionality of online transactions is still a big question, many countries are facing. With the emergence of Bitcoin in 2009, most of the governments realized that the answer to this question lies in Blockchain technology. So, what actually is Blockchain and how it can make online payments better? We explained it here.
In easy words, Blockchain is a digital log sheet that maintains records of all transactions which take place in a secured database. In terms of online transactions, Blockchain allows users to send & receive money and handle their accounts without any third party intervention.
Suppose, you are a store owner and want to incorporate accepting online payments. But, you are not sure whether the payments that customer will make will be authentic or not? By opting for Blockchain technology, your customer and you will have shared access to the payment logs. Consequently, the management of online payment will become easier, with no issues like payment tempering.
Initially, Blockchain was introduced to online payments for smooth functioning of Bitcoin digital currency. Once the way to use it for non-Bitcoin transactions is discovered, Blockchain can revolutionize the productivity of a business in several ways. Few of them are given below:
Normally, when the money is transferred from a sender to recipient, it has to flow through certain channels of the financial institution for regulatory reasons. This makes the process lengthy, close to a few days. With Blockchain, there will be no intermediary between you and your customer to regulate money. Blockchain’s algorithm automates the regulation and, in turn, makes the payment lightning fast.
Businesses that choose Blockchain to support their online transactions will make an impact on the global level. The reason behind this is that Blockchain works as a distributed money management system. It allows anyone to transfer money within a protected database. Blockchain can be beneficial for both, MNCs which have to operate in different currencies with different rates and small businesses which usually face difficulties in settlement.
Economies where digital markets are still in their premature state, achieving security is still a major concern. Blockchain technology manages full transparency between seller and buyer as it is completely based on the concept of open-to-all. Hence, the security bar in Blockchain is higher than any other technology.
Looking at the effortlessness and speed that Blockchain technology provides, it gets easier to manage heavy inflow of fund for all industries that work on this technology.
To encourage awareness for digital transactions and bring them in practice, many governments have exempted additional taxes from the business that have adopted digital payments. Blockchain technology makes sure that the businesses no longer need payment assistance devices for better cash flow.
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