The Dubai Department of Finance (DoF) in conjunction with Smart Dubai Office (SDO) has launched a blockchain-powered payment system to enable the Dubai government handle transactions and staff payments in real-time; as well as ensure accuracy and transparency in its various government agencies including the Police, Roads and Transport Authority, Dubai Health Authority and other parastatals.
The new blockchain platform termed ‘Payment Reconciliation and Settlement System’ is expected to improve the current redundant process with reference to speed of payment disbursement and also eliminate the current process where staff have to physically go to payment portals and manually reconcile or settle payments after which a fee is deducted and the remaining amount transferred to relevant authorities. At this time, transactions and payments across the UAE government agencies is time consuming and takes about 45 days to complete any given operation.
Through this blockchain concept, payments will be fully automated and require only minimal human intervention which will hence eliminate the friction associated with the current methods. Other benefits include immediate dispute and claims resolution, transparency of funds transfer and immutability of financial records.
At this time, Dubai’s Electricity and Water Authority (DEWA), the Knowledge and Human Development Authority (KDHA) have both begun implementation of the blockchain payment system with over five million transactions processed; other government agencies like the Dubai Police, Airport Authority, Customs, Department of Tourism, Courts and more are expected to join in the coming weeks.
While speaking at the public launch, Smart Dubai CEO Wesam Lootah in his words said;
We at Smart Dubai consider technology as a means to help improve people’s quality of life and spread happiness among them. For us we believe that blockchain technology has massive potential and if correctly applied across various key sectors; will help our emirate achieve its ambitions for a full fledged smart transformation.
He further noted that in 2018 alone, investments in blockchain technology had surpassed that of the previous years combined and that analysts predict the blockchain market would be worth $290 billion by 2019. In her own words, Dr. Aisha Bin Bishr, Director General of SDO also referred to blockchain as ‘one of the most promising emerging technologies’ which cannot be ignored.
Further analysis and statistics as regards the Dubai blockchain payment system projects that its blockchain ‘paperless’ transaction would save the government 25.1 million man hours or alternatively $1.5 billion per year.
This move by the Dubai government forms part of its long term mission to become the first blockchain-powered government by 2020 and attract blockchain startups or established companies to Dubai; IBM, Consensys and Smart Dubai are the emirates major blockchain partners at this time.
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