Dubai: Smart Dubai on Sunday integrated blockchain technology into its online payment portal, DubaiPay, to allow reconciliation and settlement transactions to be performed in real time, officials said.
Mira Sultan Obaid Abdul Rahman, director of smart services-enablement department at Smart Dubai Government, told Gulf News the strategy was to increase government efficiency by transferring all transactions to the blockchain network.
#SmartDubai continues to grow through the horizon of success as they launch the “Payment Reconciliation and Settlement” System today, developed in collaboration with #Dubai Department of Finance as a #Blockchain-powered upgrade to its financial system. pic.twitter.com/fESbFBuKpj— Smart Dubai (@SmartDubai) September 23, 2018
She said the Department of Finance (DoF) would be working behind the scenes for reconciliations, settlements, refunds, disputes and other issues.
She added that the payment and reconciliation process was sequential and would take up to 45 days from the day a user makes a payment.
“The DoF has to do some manual work such as exchanging files between them, banks and the entities before a final payment is made to the entity. There is no real-time monitoring of the transaction in the old system and with blockchain, the whole process can be monitored in real time,” she said.
Dubai aims to become the world’s first blockchain-powered government by 2020.
Mira Abdul Rahman said there are more than 20 use cases in different stages of implementation by the Dubai Government.
Moreover, she said, some of the government entities had made great strides in the new technology including the Dubai Land Department and Dubai Economic Department.
“Blockchain is not going to replace the current technology but it is going to compliment it and can be introduced in many industries such as identity, property, healthcare, energy, trading, loyalty programmes, to name a few,” she said.
Counting down investment
In 2016, the total private sector investment in blockchain technology stood at $1.1 billion (Dh4 billion) globally and increased to $2.1 billion in 2017, she said and added that 600 new companies established their businesses in blockchain globally in 2016 and increased to 1,216 companies in 2017.
DubaiPay portal has more than 41 entities (27 government and 14 non-government) connected to the platform.
The blockchain project was awarded to Avanaza Solutions and the project team was formed between Smart Dubai and Department of Finance.
In the first phase, she said that Dewa, Knowledge and Human Development Authority (KHDA) were the first government agencies to join the system, apart from Emirates NBD and Network International to participate in the banking related procedures.
Dewa and KHDA have already processed more than five million transactions using the blockchain system.
More government entities such as Dubai Police, Roads and Transport Authority, Dubai Health Authority, Dubai Airports, Dubai Customs, Dubai Municipality, Department of Tourism and Commerce Marketing, Dubai Courts, Dubai Holding, and a number of banks and financial services providers are expected to join the system.
In 2017, Mira Abdul Rahman said that DubaiPay has collected Dh13 billion from 9.4 million transactions, an increase of 17 per cent compared to 2016.
What is blockchain?
Blockchain’s architecture consists of a distributed ledger, held by a community of willing participants. Since no one person or organisation is in possession of the entire transaction history — the creation of a Bitcoin and its subsequent passing from hand to hand — no one can game the system.
In short, it allows people or systems who don’t trust one another to share valuable data in a secure and tamper-proof way.