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08/21/2024

DBS Bank Pilots Blockchain-Based Government Grant Disbursement

Singapore's DBS Bank has deployed a blockchain-based solution to streamline the disbursement of government grants. DBS Bank announced that for this pilot, it partnered with Enterprise Singapore (ESG), an agency under Singapore's Ministry of Trade and Industry, and the Singapore Fintech Association (SFA), an organization that promotes financial technology in the country. DBS Bank Uses Smart Contracts to Disburse Government Grants In the pilot, SFA disbursed government grants to 27 m

DBS Bank Pilots Blockchain-Based Government Grant Disbursement

Singapore's DBS Bank has deployed a blockchain-based solution to streamline the disbursement of government grants.

DBS Bank announced that for this pilot, it partnered with Enterprise Singapore (ESG), an agency under Singapore's Ministry of Trade and Industry, and the Singapore Fintech Association (SFA), an organization that promotes financial technology in the country.

DBS Bank Uses Smart Contracts to Disburse Government Grants

In the pilot, SFA disbursed government grants to 27 members. DBS said the pilot demonstrated how programmable, blockchain-based grants can improve efficiency, strengthen governance, and give businesses faster access to government funding.

Using DBS's permissioned blockchain, ESG and its intermediaries — such as SFA — can define program conditions and manage grant disbursements. According to DBS, this includes releasing funds to approved recipients once certain business conditions have been met.

When conditions are fulfilled, smart contracts verify that they have been satisfied. Following this process, grants are automatically disbursed to beneficiaries.

According to DBS, the solution improves governance controls and reduces the need for intermediaries to manually handle cash, enabling businesses to receive government grant funding more quickly.

Furthermore, the bank's permissioned blockchain provides end-to-end visibility into the process, delivering greater transparency for all participating organizations.

Permissioned Blockchains

Permissioned blockchains are networks with an access control layer that only allows pre-approved participants at designated permission levels. While they use distributed ledger technology, these blockchains are only partially decentralized.

Outcomes from the MAS-Led Project Orchid

DBS Bank also noted that the programmable grants pilot applies lessons learned from its participation in Project Orchid, a digital money initiative led by the Monetary Authority of Singapore (MAS). The initiative examines the benefits of tokenization with local stakeholders.

DBS Bank had previously partnered with digital payments provider Ant International to develop a blockchain-based treasury and liquidity management solution. On August 13, DBS launched its treasury tokens, which Ant would use for liquidity and treasury management. These tokens reside on the bank's permissioned blockchain, which uses the Ethereum Virtual Machine (EVM).

The solution was built using systems developed through the company's participation in another MAS digital money initiative, Project Guardian.