WEF Report Says Blockchain Can Solve India’s Insurance Schemes

Jafrin  |  Dec 10, 2020

A recent report co-authored by the World Economic Forum and Chainlink laid out the standards for integrating blockchain technology with traditional infrastructure. The report in particular looked at smart contracts and how it can bring about unlocking the potentials of legacy digital systems. The paper cited India’s Crop Insurance Scheme to highlight how blockchain can help solve the country's impaired state-backed insurance schemes.

Blockchain Can Solve India’s Insurance Schemes: WEF

World Economic Firm has released a 40-page report titled Bridging the Governance Gap: Interoperability for Blockchain and Legacy Systems. The paper showcased the importance of legacy systems and distributed ledger technologies. However, it highlighted its applicability only for blockchain technology.

The paper, in particular, highlighted India’s Crop Insurance scheme of 2016. The government-backed scheme was formulated to protect farmers against natural disasters through insurance covers and financial support.

The report noted:

"The crop insurance programme serves as an apt case to highlight the current deficiencies most legacy systems face when dealing with multiparty business processes."

The report encouraged solutions for enhancing interoperability between blockchains and legacy systems, calling out the term for interoperability bridge, while adding:

"If an organization’s objective is to automate business processes in a decentralized and disintermediated manner for various reasons, then a blockchain‑based architecture becomes imperative."

India Open to Blockchain Technology

The report pointed out that blockchain technology can help ensure transparency and accountability against corruption and information security. It went on to add that blockchain’s smart contracts and oracles can help prevent the challenges centered around conventional outdated systems.

Oracles are middleware that connects blockchain-based smart contracts with real-world data. This enables blockchain apps to interact with any off-chain environment, including legacy systems.

Lawmakers in India have mixed reactions on cryptocurrencies, however, the country is quite open to blockchain technology. Earlier this year, its state-backed National Institution for Transforming India had released a report showcasing blockchain's relevance in business, social, and governance.

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