Dutch bank ABN AMRO has developed a blockchain solution to manage funds for its business customers who offer escrow accounts to their clients.

The majority of non-bank organisations that are entrusted with client funds use escrow accounts to manage those funds. With the new platform, each client of the non-bank organisation gets a bank account with the ABN AMRO Clearing Bank via the blockchain.

By doing so, fund flows between the organisation and its clients are included in payment processes under regular supervision, guaranteeing transparency. This method is designed to drastically reduce administrative costs for the organisation by eliminating escrow account management costs.

Trade equity and bond exchange Nxchange is the first client to launch the new solution, allowing companies and institutions to collect capital directly from their own websites, offering investors a regulated equity and bond trading environment.

Jan Bart de Boer, chief commercial officer at ABN AMRO Clearing Bank, said: “Nxchange is the ideal party to be starting this innovation with. They're innovators themselves; their business model is geared toward efficiency and transparency. The next step is to jointly check and assess the new functionality and to make improvements where necessary. After that, the service can be made more widely available. We're seeing a great deal of market interest for this service.”

Nxchange CEO, Marleen Evertz, added: “We can't wait to get started on this cooperation. The solution simplifies the way investors can invest in businesses and other issuers. Block chain technology also offers a wider future perspective to facilitate transactions in multiple asset categories in distributed networks.”

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