Blockchain, the distributed ledger technology that underpins cryptocurrencies such as Bitcoin and platforms like Ethereum, is expected to be a game-changer for various industries in the digital economy.
Centaline Property Agency, one of the largest property agencies in Hong Kong, has launched this year the city’s first real estate secondary market blockchain platform, with an aim to bring about digitization in the industry and provide convenience for property buyers.
The initiative is being carried out in partnership with?software and cloud computing giant Microsoft and local tech firm TFI Blockchain Technology (TFI).
In an interview with EJ Insight, Tomy Pang, chief executive of Centaline Data Technology, noted that transactions in?second-hand properties involve a long, tedious process that requires various detailed forms.?Prospective sellers and buyers have to sign multiple forms and handle stacks of paper brochures.
Transfer of the paper documents is time- and effort-consuming, and there can be disputes over discrepancies in pricing and property information due to handwriting errors, Pang said.
That inspired the team to deploy a new technology solution to digitize the traditional paper-heavy practice.
Blockchain technology helps a lot in achieving several objectives, according to Pang. Its immutability means the documents cannot be tampered with, and the distributed ledger structure allows other parties involved in the process to verify and securely share the document and data, enhancing the efficiency of the process.
With the blockchain solution embedded in the Centaline Property mobile app, all the necessary forms and documents for buying, selling, renting, and listing can be processed and completed securely online via the app, enabling customers to sign the forms digitally.
Pang said Centaline’s blockchain network is a consortium blockchain that runs on Microsoft Azure, which only allows certain authorized parties to act as “nodes” managing the network.
For now, there are only two nodes set up at Centaline and TFI, but Pang expects there will be legal firms (to handle the contracts involved in the property transaction process) and banks, among other institutions, to join the platform by the first quarter next year.
By bringing these parties onboard, Pang said one of the potential applications for the platform is to automatically follow up on the status of the property transaction or leasing process, of which the customers can be notified instantly via the mobile app.
Centaline will also be able to enhance the after-sales service, such as providing legal service and mortgage plan referrals.
Within just a few months after launch, the usage rate for the blockchain solution and e-forms has reached 30 percent as of August this year. Pang expects the uptake to keep growing to the 40 percent target set by the team.
In the interview, Pang also praised the agility of the blockchain and cloud technology powered by Microsoft: “Our blockchain platform has been completed within two months from conception and design to final testing.”
Powering the platform’s underlying blockchain technology architecture and the applications, Microsoft Azure has been providing end-to-end service support to Centaline, according to Serena Cheung, director for One Commercial Partner and Small, Medium & Corporate Customers at Microsoft Hong Kong.
She said the agility and security of Microsoft Azure’s cloud and blockchain technology enable corporate users to significantly reduce time-to-market.
Microsoft will also work with Centaline in the deployment of data analytics and artificial intelligence to create new business opportunities during the second-hand property transaction and leasing process.
As for Centaline, Pang said one of the challenges remains on how to boost the adoption of the blockchain technology among its agents and customers.
“Our frontline staff and agents may not know what is ‘blockchain technology’ and how it works,” said Pang. “In order to encourage them to use e-forms and our mobile app, rather than traditional paper forms as they usually did, the company has been providing incentives – say, a reward scheme – to them.”
He believes the adoption by staff will increase as they realize how these new technologies benefit them as tools to boost sales.
Microsoft’s Cheung said Centaline has built a solid business case for blockchain technology, which continues to mature over time.
“There is still a need for more projects that are well designed and implemented on a large number of users, in order to promote the blockchain technology,” she said.
“Customers and users may not be that concerned about how exactly blockchain works. But they will definitely enjoy a better user and service experience.”
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