According to a post released by The Korea Times on July 15, 2019, Shinhan Card Co. Ltd., global top-five credit card company in South Korea, obtained a patent for a blockchain-based payment system. It will be the first company in the world to have established a credit transaction service using blockchain technology.
Blockchain for a New Payment Infrastructure
Shinhan Card, established in 1990, is Korea’s biggest, global top-five credit card company. They are pioneers in the digital payments industry and they introduced the technology of sending virtual one-time card numbers in Visa’s 3-D Secure.
To maintain the top spot in its sector, Shinhan Financial Group’s subsidiary will be the first in the world to have developed a global financial service based on blockchain technology. The service offers the same functionality as a credit card such as setting a maximum spending limit, paying in monthly installments and completing payments between merchants and consumers.
According to the post, the company started a feasibility study including technology reviews a year and a half before the patent was actually received, giving them time to test and prepare the technology ready for world expansion.
A member of the Korean company stated:
“We are seeking measures to make the patent valid in European countries, the U.S., Japan, China, Vietnam, and Indonesia.”
The patent could introduce credit transactions without the need for a physical card. System users can make payments simply by using an app on mobile devices thus reducing costs while also offering better user experience.
This infrastructure would completely revolutionize the traditional credit card system which is based on three intermediaries: credit card firms,