Smart Contracts refer to as lines of code stored on a blockchain. They automatically run when preset terms and conditions meet. In a nutshell, they can be called programs that execute as they’ve been set up by the developers. The most significant benefits of using Smart Contracts is in business collaborations. Between businesses, they can be executed to enforce a sort of agreement so that all participants in the network can know the outcome without involving an intermediary.
Providing an example is the simplest way to explain the work of Smart Contracts. If you’ve ever shown interest in buying a car at a dealership, you may be aware of the frustrating steps required to complete.
If you don’t have enough money to pay for the car outright, you’ll need to follow the financing process. It will require a credit check and several forms to be filled out along with your personal information to validate your identity. Along the way, you’ll need to deal with several different people, including the salesperson, finance broker, and lender. Additionally, for their work, compensation will be given as well, with various charges and commissions added to the base price of the car.
Here, blockchain technology-based Smart Contracts services can amazingly enhance this cumbersome process that requires several intermediaries to achieve a trust among participant in the transaction. However, when your identity is available on a secure blockchain, lenders won’t have to think about it. They can make quick decisions about credit. Then, a smart contract will be executed between your bank, the dealer and the lender. Once you release the funds to the dealer, the lender will hold the car’s title. And they repayment process will begin based on the agreed terms. Also, the transferring of ownership become automatic as the history of the transaction will be recorded on the blockchain, that’s shared among the participants and can be obtained for a check at any time.
Now you have got a clear view of smart contracts. I’m sure you’ve been thinking of some ways to incorporate them into your company. With Oodles Blockchain’s Smart Contracts Services, you can have access to unique development tools, tutorials and a development environment to develop an efficient smart contract for streamlining financing processes. Ready to get started using Smart Contracts on the blockchain. Contact Us for a Free-of-Cost consultation.