Blockchain Technology at BIK. Interview with Andrzej Zduńczyk, Director of the Product Development Department at Biuro Informacji Kredytowej

Blockchain Technology at BIK. Interview with Andrzej Zduńczyk, Director of the Product Development Department at Biuro Informacji Kredytowej

BIK, which has operated in the Polish market for over 20 years and commonly associated as a financial institution, is, in fact, a modern IT company, which, for instance, develops solutions enhancing system security for banks and other financial institutions. To be not groundless, we can refer to a wide spectrum of anti-fraud solutions and the development of BIK in the area of products using blockchain technology.
In recent years, we have been able to observe a kind of pursuit of technologies. Does BIK participate in this race?

Given its unique position in the information interchange ecosystem, BIK is in close collaboration with the banking sector and loan companies. We pay close  attention to trends and come up with new solutions in response to the needs reported by the market. As for new innovative BIK services for the financial sector, they certainly include the BIK Anti-Fraud Platform, which has been repeatedly awarded in industry competitions, such as Hit of the Year for Solutions for Retail Customers. BIK was appreciated and was on the Polish Fintech Map 2021. It is thanks to the state-of-art mobile application My BIK. The solutions that make use of modern technologies also comprise the Blockchain BIK Platform, which is successfully operating in the banking (PlusBank) and financial (Billon Solution) sectors. We are currently working on a sectoral behavioural biometric system. It will be yet another platform solution developed at BIK.

In a nutshell, we endeavour to stay ahead of our customers’ needs, whereas new technologies are the cornerstone of the services and tools built at BIK. It is worthwhile to mention that on top of development activities, we attach equal importance to making sure that the supreme level of security for the information interchange system in Poland will be provided.

To what extent is the BIK security mission related to blockchain technology?

Nothing related to security is strange to BIK. BIK acts as an administrator of the database that is full of information on credits and loans taken by over 25 million Poles. There is no such another collection in Poland. Customer verification at BIK is a permanently embedded constituent when it comes to the credit processes at banks and loan companies. This is why, BIK prioritises the availability of data while maintaining the highest security standards. Thanks to that, whether we like it or not, we have become experts in this field.

But coming back to the question, it was the very possibility of ensuring the highest possible level of security for sensitive personal data that decided about BIK’s using solutions based on blockchain technology.

So, security was the core factor behind building the BIK Blockchain Platform?

BIK has worked on the concept of making use of blockchain technology, which had to enable safe and cost-effective digital distribution of both public documents, such as rules and regulations or tables of fees and commissions, as well as personalised documents: loan contracts or bank statements, namely documents addressed to a specific person. Going further, our solution had to meet the requirements imposed by the GDPR with regard to data privacy and identity protection, to enable the exercise of the right to be forgotten (confidentiality), while maintaining the full audit trail of all operations performed.

The new solution was to render it possible to fully use digital communication between banks and customers, to ensure the immutability and authenticity of the documents sent, and to meet the requirements of the so-called durable information medium. The BIK’s idea revolved around a sectoral solution for the Polish financial sector that would replace the costly distribution of documents on paper or on CDs. By the way, who of us still has a CD drive at home?

The outcome of these works brought about the BIK Blockchain Platform, which not only can be used in the banking or financial sector but by any institution that wants to share documents in a secure digital way.

Then maybe let us start with the definition. What is blockchain?

Blockchain is DLT, namely distributed ledger technology. It is a specific type of database which, instead of storing data on a central server, stores it in a distributed system. In other words, it is a decentralised and coordinated network of many applications called nodes. DLT is the main distinguishing feature and essence of the concept used in the BIK Blockchain Platform solution. Let me give you an example.

An entity that publishes their data in one of the nodes has no idea in which part of the system that data has been stored or distributed. Thus, the entity does not exercise control over access to the data. This solution guarantees the integrity and non-repudiation of the recorded information. Moreover, this “distribution” allows to ensure the confidentiality of documents provided by the institution, it maintains the continuity of customer access to their documents and guarantees a full audit trail of all operations performed.

…it means that there are many types of blockchain… I conclude that the solution used by BIK is a unique one?

Indeed, blockchains can differ from each other, if only because of the manner of how participants are admitted to the system or the method of approving operations in it. It took us a long time until we found an optimal solution. We were driven by overriding reasons. First of all, the BIK Blockchain Platform is a synergy of BIK’s long-term experience in developing solutions for the entire financial sector and the effect of advanced IT knowledge, as well as of the proprietary project by Billon, a vendor of modern technology.

Billon’s technology used in the BIK concept guarantees the inviolability of documents, so it serves to solve the problem of the so-called durable information medium. It is based on the distributed database (DLT) discussed beforehand, in which all events and objects are registered in the form of successive blocks.

Apart from the essence of the technology, I mean DLT, what is the advantage of the BIK solution?

What is the advantage of the BIK Blockchain Platform is the flexibility of its architecture. It renders it possible to create a variety of dedicated blockchain networks within specific sectors, for instance, a blockchain network for the banking sector or a blockchain network for insurance companies, etc. This means that the BIK Blockchain platform may also be used outside the financial sector by institutions such as telecommunications, insurance, energy or e-commerce companies.

One of the features that make the BIK Blockchain Platform standing out among other blockchain systems is the ability to safely store the entire content of the document in the blockchain network, instead of just a shortcut to it. These functionalities ensure the security of the information provided and full compliance with regulations. The solution guarantees immutability and the ability to read the published document at any time. Furthermore, private persons may benefit from having access to all documents published within the solution – through a trusted place from a trusted solution vendor, such as BIK. Thanks to this facilitation, private individuals will ultimately be able to opt-out of storing paper documents.

The BIK Blockchain platform is an end-to-end solution for digital relations between institutions and customers. It is a step forward in building fully digital communication with customers.

What is that shortcut to the document about – can you give us an example?

The document shortcut refers to a document uploaded to some server, so the data is not distributed. Suppose that if most of the network fails, the document shortcut could be deleted.

The way how we make use of blockchain technology has gone one step further to a more advanced and secure model, as we are able to distribute and put the entire document together if even a considerable part of the system fails.

Can we say that the BIK Blockchain Platform is a finished solution? Or perhaps the inevitable technological rush poses new challenges paradoxically?

Currently, the BIK Blockchain Platform is a ready solution for publishing and reading public and private documents. We are working on the deployment of new functionalities, for example, on the functionality involving active delivery of documents. Several companies are interested in deploying the platform, and not only are we conducting talks with the banking or insurance sector but also with debt collection companies.

We are still facing challenges. Paradoxically, they are related to the constant fear of some market participants against the use in practice of relatively new technology, which blockchain is, notwithstanding that it offers obvious benefits: financial, marketing, and it ensures data integrity and security.

We are sure of the supreme quality of our solution. That is why we are optimistic about the future and predict a steady increase in interest in such solutions.


Andrzej Zduńczyk

Director of the Product Development Department, BIK

A graduate of the Faculty of Finance and Banking at the University of Łódź. His banking adventure started in 1999 at PKO BP. From June 2003, he was associated with the Danish bank Nykredit Realkredit A/S, where he held expert positions related to the area of mortgage risk assessment. He started working at Biuro Informacji Kredytowej S.A. in December 2008 in the area of products dedicated to the banking sector. Since October 2018, he has acted as the Director of the Product Development Department and is responsible, among other things, for the business maintenance and development of the BIK and BIG InfoMonitor product offer.


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