Three major Japanese players in technology, payments and banking will run a joint trial to determine how well a new blockchain-based identity verification system operates across companies and industries, the firms announced Thursday (Oct. 15).
Technology powerhouse Fujitsu Limited said it had developed the blockchain system at the center of the newly announced trial in 2019. At the core of the system, which Fujitsu calls “Identity Exchange,” is the principal that decentralized data can be used to quickly assess the trustworthiness of potential parties in a transaction.
Joining Fujitsu in testing real-life applications of the system — 100 Fujitsu employees will use the system to conduct transactions for an anticipated four months — are JCB and Mizuho Bank.
JCB is a major player in the payments sector in Japan, reporting 141.5 million card members and $321.6 billion in 2019 transactions. Mizhou Bank is a unit of Mizhou Financial Group and among the larger banks in Japan.
“Through this demonstration trial, Fujitsu, JCB, and Mizuho Bank will confirm the accuracy of ID information held by multiple business operators and verify the mechanism by which customers can safely and securely control the distribution of ID information,” the companies said in a prepared statement. “Going forward, JCB, Mizuho Bank, and Fujitsu will consider innovative service models best suited to ID information management, regardless of the industry or sector.”
JCB and Fujitsu have been conducting a joint research project on digital identity since 2019, the companies wrote in the news release. “From the viewpoint of improving the management and reliability of information held by multiple parties, we are conducting a demonstration trial on an interoperability model of identity information together with Mizuho Bank.”
While the participating companies’ work was underway well before the COVID-19 pandemic, a number of experts predict the crisis will accelerate the demise of cash or plastic cards as essential components of financial transactions.
In March, Philipp Pointner, chief product officer at Jumio, told PYMNTS the payments industry is working to get beyond the problems that have made some authentication and trust systems “clunky” and “difficult.”