Blockchain as a service may be in your future — like it or not


Although consumers have been reticent about digital payments, new services — such as Venmo and blockchain — are making the benefits of mobile payments difficult to deny.

As digitization and mobile devices overtake virtually every corner of business, they are upending the traditional services that consumers take for granted. Think financial transactions.

Digital payments have been disrupting cash and credit cards for several years. Mobile wallets, or digital payments, enable consumers to pay for items with a smartphone or tablet using services such as Apple Pay and Google Wallet. With these mobile payments, consumers may accrue loyalty points for future discounts, or simply circumvent the hassle and insecurity of cash and credit cards. They are also compelling for lower-wage earners who don’t have credit, or for Millennials who want more flexible payment options. Despite concerns about data security risks and flimsy ROI, digital payments may be nearing the tipping point for adoption.

Even traditional technology vendors — Microsoft included — are getting in on the action. Microsoft has been hard at work on a blockchain as a service offering (BaaS) to be hosted on its Azure cloud. Blockchain technology enlists a distributed digital ledger. It eliminates the single point of failure of traditional credit and doesn’t need a central authority, such as a bank. It is transparent, secure, outage-resistant and auditable, making it appealing to industries and consumers in search of greater levels of security.

An executive at a southeastern retail company who requested anonymity said he wants to ramp up his digital payment offerings, and is looking at technologies like blockchain — once consumers and the market rally around certain options. “We use Apple Pay, but we are waiting to see which other services we want to bring on and if customers really want them,” he said. “We don’t want to offer everything under the sun.”

This week, Microsoft furthered its foray into blockchain as a service. It formed a partnership with the R3 Consortium — a collection of major banks, including Citigroup, Barclays and Wells Fargo — to promote and extend BaaS through infrastructure and tools on the Azure platform.

“R3 and member banks will experiment and learn faster, accelerating distributed ledger technology deployment,” said Peggy Johnson, executive vice president of global business development at Microsoft, in a statement.

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