VeChain and Fanghuwang strike key partnership
Partnership will spearhead move for VET into financial services.
VeChain (VET) has announced a move into financial services after striking a partnership with Fanghuwang.
- Fanghuwang – A relatively new lender with a focus on SME property mortgage loans, that uses cloud computing and data analytics to help boost its efficiency and manage lending risk. Its cumulative transaction size is predicted to reach over US$15.5 billion by the end of 2018.
- VeChain – A cryptocurrency with a focus on blockchain tracking of end-to-end supply chains. VeChain Thor is its upcoming iteration, and what Fanghuwang will be using.
Fanghuwang is looking for several key outcomes from the partnership:
- Collecting and managing client data more efficiently and with fewer errors.
- More efficient use and sharing of client data, using the blockchain to compliantly manage and share data across multiple parties.
- More secure data storage.
- Reduced costs across all involved parties, such as related banks and the Notary Public Office.
Blockchain technology, in general, seems well suited for these outcomes. Digitisation can help improve efficiency, reduce error-rates and allow for easier verification of data across the board, while blockchains also allow for easier sharing of only key pieces of information, for a wider range of applications, without compromising client confidentiality.
Importantly, it also allows for near-complete automation across all of these objectives.
The objectives and systems used are quite similar to a recent IBM - Maersk partnership on the other side of the world.
What this means for VeChain
Firstly, this is potentially good news for VeChain in the same way that any high profile partnership is good news for a coin. But it may also have implications going beyond that.
Proof of concept for VeChain Thor in financial services
"The use cases for VeChain Thor within the financial services sector are abundant, and VeChain has grand aspirations to make the financial services sector one of our main focuses on our development plan," says VeChain. "We welcome all reputable financial services enterprises; such as commercial banks, investment banks, insurance, asset management companies, lending companies, etc."
By inking this deal ahead of the transition from VEN to VET, the company will be able to demonstrate real-world applications. This is often one of the more challenging obstacles for coins.
Fanghuwang can also benefit VeChain
Fanghuwang has already been disrupting the existing lending market in China through the use of smarter lending technology. It says its managed to cut the typical SME mortgage approval time from months to days, while using its own smart risk management system.
At the end of the October of 2017, Fanghuwang's interest overdue was 0.3%, overdue principle was 0.6% and bad debt over 45 days was 0.
It's also making moves towards AI, and the marriage of VeChain and Fanghuwang might result in the significant-in-its-own-right creation of a new kind of blockchain AI.
Progress for blockchain in general
Many established institutions are still on the fence about blockchain technology, citing disruptions to their existing processes and customers, and a lack of confidence in the technology as a whole. Fanghuwang's successful application of blockchain technology could force the hand of other institutions that are still on the fence.