The service industries (formally termed as, ‘tertiary sector of industry’ by economists) involves the provision of services to businesses as well as final consumers. Like a conduit between Businesses and Consumers.

Service industry provides services which include but not limited to accounting, trade finance; government enabled services, record keepers, insurance and healthcare industry and many more. There is a specific business entity that makes huge revenue from providing services such as payroll services, DMAT services, fintech like Paytm/ UPI/Bhim or any pay services.

Service industry being the conduit between Business and Consumers, their working protocol is to get into a service contract with both the parties. The service contract is enabled by providing all the critical information which is required for executing a transaction. The service contract gets authenticated by furnishing the legal data (ID proof, bank details, and others as per service need).

The data stored here are multifold and associated with profiles. Till date, very few service industry has enabled for e-KYC. Even though the e-KYC has been enabled, there has been an issue concerning security breach and misuse of data.

Moreover, in an e-KYC space, the othe

r concern is with respect to the speed of the service. Non-Automated/paper-full processes with its drawbacks.

There are many concerns which are visible, but there are many which go unnoticed. Some of the concerns are:

1. Is my data in safe hand?
2. What is done with my data?
3. Who all can access my data and for what?
4. Can there arise of politico-socio profiling?
5. Can anyone misuse my data?
6. Many more…

The above concerns show that the service industry needs to improve tremendously in making their service better. If we evaluate the all the concerns, it falls under four buckets:

1. Efficiency – Can there be automated process enablement involving all stakeholders?
2. Security – How do I ensure that my data is not getting misused or accessed by unwarranted?
3. Privacy – May I know with whom is all my information shared?
4. Data Sharing – How can data be shared only with people who need access to it?

Thus proving that the Service Industry needs to transform, augment and modify the current business backbone with new technology.

Blockchain as technology can provide the solution. The technology can help in overcoming and enabling many challenges that present-day service industry faces. The Blockchain is primarily a Decentralized Consensus-based Smart Contracts with Security Enablement.

• Let us evaluate conceptually how Blockchain can fit –

1. Decentralized Database/Ledger – let all stakeholder be party to a transaction. Allow the data to be shared among all the stakeholders. Blockchain technology can help businesses, consumers, and intermediary service conduit into unified Block which can be identified uniquely via the identifier.
2. Smart Contract – Between businesses, consumers and service conduit, create a contract which shall be executed smartly only for the services that have been agreed in the contract. Any other transaction executed which is not part of the contract will fail at source level or will get disqualified by a participating entity (Consensus)
3. Consensus – The transaction execution will not be complete unless all participating entity agree on common ground. It works following way – Initiate -> Inform to participating entity -> Verify and Authorize by participating entity -> Execute Transaction -> Update to all.

• Conceptually, Technology wise we have seen Blockchain can be the best fit. However, how does it allay the concerns that have been raised by many? Let us bring a perspective by considering following business scenario:

Business Scenario – Loan sanctioning against the collateral

Participant Entity – Loan Sanctioning Authority, User and Digi Lockers (Document Keeper Service Industry)

1. Concern 1: Efficiency – Can there be automated process enablement involving all stakeholders
2. Due to tight coupling in the form of Block and linked chain, authentication around entity and contract has already been enabled. So any services about the agreed contract can be executed then and there or rather automated.
3. Digi Locker services – All the documents are stored digitally and are tagged to the legal owner. Since there is smart contract enabled among the three-entity, the user need not have to manually submit the document again to the Loan Sanctioning Authority. Instead, all relevant documents can be passed to Loan Sanctioning Authority via Digi Locker services.
4. A transaction execution token among three entities will enable for securely identifying and closing of transaction
5. Concern 2: Security – How do I ensure that my data is not getting misused or accessed by unwarranted
6. In this case, the user (and his/her documents) are uniquely tied with a unique identifier, and no one can share/view/update/modify documents without the consent of the owner.
7. As a principle, the transaction gets recorded and informed to the owner, and he/she approves or disapproves the transaction based on it being valid or not.
8. The data/document stored with Digi Locker is similar to the locker service of any Bank. Essentially one key is with the bank, and another key with the bank account holder and both the keys are needed to while opening the locker. The same principle gets applied over here with the concept of token. All the owners own and participate in completing a transaction and hence it is secured.
9. Concern 3: Privacy – May I know with whom all, my data is shared
10. As mentioned above, the owner is king. The owner gets all the trail of the transaction related to his/her profile. So owner can track if his data is being misused or not. In case he finds that the data is being misused, he can raise a red flag with the appropriate authority.
11. Concern 4: Data Sharing – How can data be shared only with people who need access to it
12. All transaction is executed based on Smart Contract and Consensus. Unless there is a valid contract, no data can be shared with an unknown entity. Also, the owner has to authorize for the data sharing, without owner permission no data can be shared.

Today, it is important for Service Industry to start looking from Customer view. There is an opportunity for Service Industry to change the industry perception and thrive in this competitive business. There are many reasons why service industry needs to look at this:

1. Avoiding Legal Penalty – Because of the secured system, the data breach can be avoided. Nobody can get easy access to the sensitive data, and hence chances of user/owner filing a legal suite/penalty on Service provider can be minimized.
2. Greater Transparency and Higher CSAT – Since the owner of the data is part to the whole transaction, the overall transaction is very transparent to all. Nobody can claim that without the knowledge of owner some transaction got done and hence saving in manpower time
3. Improving Efficiency and reducing operational cost – All linked, everyone authorizes transaction can be done in real time basis. Hence there is no lag time. Also since all participating entity are involved in real time – no or fewer concerns wrt QoS will be raised which in turn means no/fewer manpower required for issue resolution.

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Please note: This blog is part of a series of Blockchain articles. Through these articles we explore about Blockchain – The technology, the hype, the opportunity, the do’s and the don’ts.

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