GM financial Springs into Blockchain
Late 2017, GM experienced their first dip into blockchain after it partnered with Hyperledger along with J.P Morgan, IBM, and FedEx. This time around, the Auto Giant has announced its partnership with blockchain start-up, Spring Labs.
Spring Labs raised $15 million in its first funding round last spring and has come a long way since. The auto lender will join the Spring Founding Industry Partners Program to work with Spring Labs as it develops its blockchain products, the first of which are expected to launch in the first half of 2019.
According to the CEO of Spring Labs, Adam Jiwan, “We came together with the view that we could develop a series of use cases that would match some of [GM Financial’s] core business priorities as a lender, or potentially [those of] GM as a parent company”, reported by Forbs.
The Chief strategy officer for GM financial, Mike Kanarios believes the partnership with GM financial with Spring Labs is a “natural fit” as the company explores blockchain technology. “We believe that they have the most momentum in this space,” Kanarios says.
This blockchain startup is developing a protocol that will allow companies to securely exchange and verify sensitive information such as a customer’s credit history. Jiwan told Forbes this could help both lending and non-lending institutions share information about customer identities without compromising customer privacy, making it easier for everyone to identify fraudulent actors.
Kanarios told Forbes he thinks that Spring Labs’ protocol could help GM Financial combat synthetic identity fraud, which occurs when a fraudster uses both real and fake identification information to create a new identity and make purchases. Fraud like this costs GM Financial millions of dollars per year in both losses of inventory and prevention costs, and Kanarios says a blockchain-based identity verification program could be a “better, faster, and cheaper system” than the lender’s current processes.
The company had high hopes to get positive feedback from the technology in this aspect and wish to expand to other sectors such as seamless payments and expansion of blockchain in general. David Treat, A managing director and global blockchain lead at Accenture, believes that the use of blockchain could one day be used in insurance and even AI technology to make driving safer, more secure, and efficient.
Accenture is a part of MOBI, Mobility Open Blockchain Initiative, along with GM and other members like; BMW, Ford, And Groupe Renault. MOBI is a group dedicated to exploring applications of the blockchain.
There are many questions to ask and research that is left to do before blockchain is the norm of any sector, but getting a head start now in order to implement it on a large scale is essential. Kanarios knows blockchain may not be for every company need but its potential is hard to ignore.
“Of course there are…challenges with it,” he says, “but it’s one of those things that we wanted to get involved in to make sure that we took advantage of the technology.”