The Basics and Benefits of a Digitized Guarantee Network
The Guarantee Network or paperless guarantee network can be a simple, streamlined solution for processing guarantees of insurers and banks. Professionals from many industries work with guarantees. However, if certain processes are not followed correctly, the steps involved with creating and accessing them can be complicated and offer opportunities for fraud. Mistakes, or opening the door to fraud, most often occurs when individuals are rushed and mistakes during the process. Digitizing the process with the guarantee network is a step forward for all involved. In a digitized world, there is a speedier transaction, more trust, clearness of data, lower costs and an increasing market share.
The primary processes of a paperless guaranteed network are run on a “distributed ledger” or a blockchain. A distributed ledger is a decentralized database spread across regions, branches or sectors. Guarantee issuers work with their customers to create this database which may be accessed by clients or other interested parties using a specially designed interface or app. This distributed ledger is used for issuing, managing and tracking the status of guarantees. It can be reached and updated via an app by those given access. For participants, the process appears well-organized and straightforward while they can rely on secure operations. All the heavy lifting is done behind the scenes using the latest technology. The guarantee network, operated by blockchain technology, reduces time spent on guarantee-related tasks and lowers the chance of fraud too. With this guarantee network in place, those who require a guarantee and those who issue them (such as insurers) will find the process much smoother.
While the process may sound challenging, our video demonstrates how to make it a bit simpler. Watching this will show you how streamlined and accessible it is for all those who access the guarantee network. The video explains that two individuals are signing a contract for the construction of a home. There may be a need for extra documentation. And a buyer may request a guarantee of the work that the builder or contractor will complete. At this point, the contractor must work with his insurer to guarantee the property. A streamlined guarantee network allows the insurance professional to input information into a network (using the distributed ledger.) The blockchain works in the cloud to store documentation so that parties who need it can access it quickly and securely. These parties may include the contractor or his or her representative. The person who obtained the guarantee will be able to share it with the buyer using a clickable link. This link launches an app with all pertinent information. The process also shows how access to the guarantee will expire at a mutually agreed date. The blockchain will then store data as appropriate. Finally, you will realize the many benefits of the guarantee network using blockchain technology.
The guarantee network is a big step forward for contractors, builders and financial businesses that need to issue or access guarantees on a regular basis. The blockchain-powered guarantee network is only made possible through the technology available from SAP. For more information about Blockchain, please visit SAP Leonardo Blockchain: A platform for building transactional applications that establish trust and transparency while streamlining business processes.