Blockchain-based Financial Enterprises Credit
Value Information System Using Federated AI
Neelam Badhani
Department of Computer Science and Engineering
Graphic Era Deemed to be University
Dehradun, India
madsmandy321@gmail.com
Abstract— Blockchain is a distributed digital ledger
system that enables the safe, transparent, and decentralised
management of records. Rather than being managed by a
single central authority, it is essentially a database of
transactions. A block of transactions is created in a blockchain
network once each transaction has been confirmed by a
number of network nodes. A block that has been added to the
chain cannot be changed after that point, creating a tamper-
proof record of all network transactions. Blockchain has
numerous other possible applications than cryptocurrencies
like Bitcoin, which is occasionally the case. For instance, they
can be applied to voting procedures, supply chain
management, and even digital identity management. The
security of blockchain is one of its main advantages. The
blockchain is exceedingly hard to tamper with because each
transaction is confirmed by many network nodes. Blockchain
technology does, however, have significant drawbacks. A
blockchain, for instance, may take a lot of computing power to
maintain, and the number of transactions that can be executed
each second may be constrained. Additionally, since
blockchain transactions are irreversible, there is no way to get
back any money that has been misplaced or stolen.
Keywords— Blockchain, Financial, Enterprises, Credit Value
Information System.
I. INTRODUCTION
Through improved integrity, decentralisation, transparency,
security, and dependability, emerging blockchain
technology can aid in enhancing credit reporting
capabilities. We suggest a blockchain-based solution to
implement access control and management of the shared
transaction information in the supply chain in order to
handle the issue of significant credit investigation data and
privacy protection. Our concept implements access control
and shared data chain management while addressing the
issue of massive credit investigation data and privacy
protection of credit investigation data. The open shared
reference architecture and the full life cycle of a monitoring
mechanism are established with the aid of the embedded
blockchain technology. It is crucial to develop a new
consensus method to support the credit investigation system
because the current blockchain consensus mechanism is
insecure and uses a lot of resources. In this study, the
consensus method may be improved to achieve blockchain
data exchange and traceability, which will help to enhance
the current credit investigation service system. Our research
contributes to the improvement of supply chain financing
effectiveness and the current supply chain financial credit
system. The way financial institutions handle credit value
has the potential to be completely transformed by
blockchain technology. Here are some examples of how
blockchain can be applied in this situation:
Sachin Sharma
Department of Computer Science and Engineering
Graphic Era Deemed to be University
Dehradun, India
sachin.cse@geu.ac.in
 Decentralized credit scoring: Credit scoring is one of the
main applications of the blockchain in the
administration of credit value. Traditional credit
scoring techniques may not be as transparent or
equitable as blockchain-based credit scoring. A
blockchain-based system can use information from
numerous sources in place of a centralised credit bureau
to determine a person's creditworthiness. This can
include information from online transactions, social
media, and other sources. Blockchain-based credit
scoring can be more resilient to fraud and manipulation
by employing a decentralised strategy.
 Smart contract: A smart contract is yet another method
that blockchain can be applied to the administration of
credit value. Self-executing contracts known as "smart
contracts" are stored as blockchain data. They can be
used to automate many processes related to managing
credit value, including loan application, underwriting,
and repayment. This can enhance effectiveness and
speed while lowering expenses and controlling credit
value's complexity.
 Reduced transaction costs: Blockchain can also aid in
lowering the costs of transactions involved in
controlling credit value. Financial businesses can cut
out middlemen like banks and payment processors by
employing a blockchain-based system for transactions,
which can drastically lower the expenses involved with
managing credit value.
 Improved transparency and security: The management
of credit value can become more transparent and secure
thanks to blockchain. Transparent, which can aid in
lowering the likelihood of fraud and mistakes.
Additionally, the use of digital signatures and
encryption can help to guarantee the security and
authenticity of transactions.
Numerous industries, including digital currency, trade
finance, KYC, and international money transfers, can use
blockchain technology. Blockchain technology, which has
the ability to reduce fraud, provide quick and secure
exchanges, and ultimately help with risk management inside
the connected global financial system, is one of the most
important developments in the financial sector.
II. LITERATURE REVIEW
The authors of [1] demonstrated how to deal with various
security threats by proposing an affordable and secure smart
grid system authentication method using a blockchain, a key
component of bitcoin (digital currency), and then tested the
method's viability to authenticate the source of the smart
grid system. According to [2], the present centralised
regulatory system needs to be reorganised in order to
accommodate distributed ledger technology. A sizable
number of legal difficulties, such as the location of physical
data storage, the legal justifications for regulatory body
intervention, or the common protocol and governance of
blockchain, also exist. Because there are restrictions on
adopting a public blockchain source, it is more likely that
financial institutions will use blockchain technology in the
form of a consortium or private blockchain. The authors of
[3] addressed the fundamental ideas underlying blockchain
technology and talked about the advantages and
disadvantages of openly distributed ledger technology as
well as the move towards hybrid solutions. He revealed the
key characteristics of decentralised public ledger platforms.
The P2P network, database, and applications of blockchain
were explored at three different levels in [4]. Blocks are
connected at the level of the global leader. Each block
contains traction, smart contracts, and links to the ones that
are related to it. Different services are able to query,
analyse, and interpret the meaning of each block of
tractions, smart contract, and financial update source at the
application level. According to [5], the blockchain
technology has undergone three technological generations:
Block 1.0.2.0, and 3.0. The successful implementation of
Block1.0's currency is Bitcoin. Block 2.0 covers futures,
bonds, loans, mortgages, smart contracts, and other
financial transactions in addition to cash transactions.
Blockchain 3.0 is a platform and application that is used by
many sectors of society, including government, science,
health, culture, and literacy. According to [6], there are
three levels of Blockchain: a P2P network, databases, and
its applications. Blocks are connected at the level of the
global ledger. Each block is linked to the one it is related to
and contains the transactions and smart contracts. Different
services can query, examine, and evaluate the semantics of
each block of transactions, smart contracts, and financial
updates at the application level.
III. BLOCKCHAIN IN FINANCIAL ENTERPRISES
Through more efficient, secure data sharing, blockchain
technology enables the whole financial services sector to
optimise business procedures.
 Payment: In order to eliminate middlemen, Bitcoin or
other digital currencies have been introduced into the
payment process.
 Funding and investment: When a startup or new service
is raised using blockchain technology. Peer-to-peer
transactions may now be carried out, and in return,
investors may get tokens that reflect the pricey future
worth.
Fig. 1 AI in Financial Enterprises.
 Accounting: reduce overall expenses related with ledger
reconciliation and resource freezing to improve
accounting.
 Identity: built-in encrypted blockchain technology is
utilised.
IV. FEDERATED AI AND BLOCKCHAIN
Blockchain and federated AI are two cutting-edge
technologies that are revolutionising the finance sector.
Blockchain offers a safe and transparent means of storing
and transferring data, while federated AI enables several
organisations to work together on a machine learning model
without disclosing their sensitive data. Without the
requirement for centralised data storage, federated AI can be
utilised in the context of financial companies to train
machine learning models on decentralised data sources,
such as client transactions or credit scores. This aids in
preserving the privacy of private data while allowing
businesses to get insights and make data-driven decisions.
Blockchain technology may be used to safely exchange and
deploy federated AI models across many financial
institutions, lowering the risk of data breaches and
guaranteeing the accuracy of the data used in the models.
This may result in increased regulatory compliance, better
risk management, and more accurate projections. AI in
Financial Enterprises is shown in Fig. 1.
Example of blockchain in financial services: Blockchain is
regarded as a cross-disciplinary synthesis of statics,
cryptography, and mathematics [7]. Blockchain is a novel
technology that has been developed using economic and
computer science principles. Blockchain offers distributed
storage, anonymity, and the benefit of data consistency in
supply chain finance [8]. Combining privacy protection
with blockchain technology can lower the likelihood of
unauthorised third parties interfering with data, maintain
data security and effectiveness to some level, and have more
widespread application value [9]. The study comes to the
research advancement of the consensus mechanism, a key
component of blockchain, and associated research progress
of blockchain in SCF.
V. METHODOLOGY
First, we gather the user's input. Information such the user
name, birthdate, PAN number, etc. If the user leaves the
data, only then do we proceed. After accepting the user
login process, information about the specific user will be
displayed, including how many bank accounts the user has
and whether or not those accounts are active and
experiencing transactions. If so, the credential value will be
enhanced and the cloud server will be updated. Fig. 2 shows
how the suggested methodology would work. Fig. 3 shows
how the blockchain would work in proposed approach.
Fig. 2 Proposed methodology.

Fig. 3 Blockchain in Proposed methodology.
Technologies used:
 HTML: Here, HTML, CSS (Cascading Style Sheets),
and JavaScript are used to construct the UI design. A
blockchain API was utilised to link the user interface to
the blockchain network, and the ethers.js library was
used to communicate with the Ethereum blockchain.
We launch the blockchain project and its user interface
to a decentralised hosting platform following testing.
 Solidity programming: After constructing the smart
contract with reference to Ethereum, we move on to
solidity programming, where we employ events and
functions for various data structures to achieve our
goals. We put the smart contract on the Ethereum
blockchain after testing. Using the instrument Remix.
Afterward, incorporate the smart contract into our
application with the aid of the library so that our
frontend or backend may connect with the smart
contract.
 Cloud server: Running a blockchain node can be labor-
intensive and need a lot of storage space and computer
resources. In this case, we make advantage of a cloud
server that can house blockchain nodes. Because
blockchain applications needed strong scaling
capabilities to accommodate a lot of data and
transactions, it offers scalability.The apps can be
horizontally scaled using cloud servers by adding
additional computing power and storage as necessary.
The decentralised storage for blockchain apps is also
provided by this server. which can also offer security.
 Regulators: It keeps track of blockchain transactions to
look for irregularities and stop fraud, money
laundering, and other wrongdoing. Blockchain that
disobeys the law or engages in unlawful activity is
subject to sanctions and penalties. To guarantee that the
blockchain project conforms with international laws
and to advance global collaboration in the blockchain
business, authorities may work together with other
regulators.
 Credit bureaus: By gathering and keeping credit data on
people and companies, this is crucial to the traditional
financial system. Because it could be used with
blockchain to trace and validate individual identities, it
was used in this project. And credit history information
in a secure and open manner. This might give people
more control over their credit information and enable
more accurate and rapid credit evaluations.
VI. IMPLEMENTATION AND ANALYSIS
Fig. 4 illustrates the flowchart of proposed methodology.
Fig. 5 shows the login page of proposed methodology. Fig.
6 shows the bank page of proposed methodology.
Fig. 4 Flowchart of Proposed methodology.
Fig. 5 Login page of proposed methodology.
Fig. 6 Bank page of proposed methodology.
 By enabling quicker, more effective, and more secure
transactions, as well as opening up new investment
options and enhancing regulatory compliance,
blockchain technology is advancing the financial
sector. Following are some ways that blockchain is
advancing the finance sector:
 Faster and more secure transactions: By doing away
with middlemen like banks or clearinghouses,
blockchain technology makes transactions faster and
more safe. This improves security and transparency
while decreasing transaction times, costs, and fraud
risk.
 Smart contracts: A self-executing programme that runs
on a blockchain is known as a smart contract. They can
be used to automate complicated financial operations
like insurance policies or derivatives contracts. The use
of smart contracts can decrease the need for middlemen
and boost the effectiveness of financial transactions.
 Tokenization and digital currencies: Blockchain
technology has facilitated the emergence of virtual
currencies like Bitcoin and Ethereum. These currencies
can be used for investment objectives as well as peer-
to-peer transactions. Real-world assets are transformed
into digital tokens through the process of tokenization,
which can potentially generate new revenue streams
and investment opportunities.
 Regulatory compliance: By offering a visible and
auditable record of financial transactions, blockchain
technology helps improve regulatory compliance. This
 can lower the risk of fraud while assisting financial
institutions in adhering to anti-money laundering
(AML) and know-your-customer (KYC) rules.
To aid in and enable knowledge exchange in a more
organised and balanced manner, a framework can be
created. This will enable certain vital knowledge to remain
hidden for defensive strategies that are advantageous at the
individual level. Additionally, additional information can be
used to reduce perceived dangers associated with
blockchain adoption and explain to a general audience the
advantages of doing so. The application of this suggested
method will demonstrate how this particular model can be
used in the financial industry. This will provide a variety of
assistance to maintain user security and privacy, especially
when combined with other privacy-enhancing technologies
like homomorphic encryption and zero-knowledge proofs.
Credit information providers, cloud services, and regulatory
bodies all play significant roles in this. They take on the
following roles.
 Model framework: The blockchain model makes use of
a peer-to-peer network, a message delivery system, and
a block data format. Additionally, the fundamental
architecture of blockchain technology has some basic
additions in this paradigm. Here is how each
component functions at this time.
 Communication between credit investigation agencies
and information subjects: Details subjects and credit
investigation organisations can communicate with one
another by first requesting the user's login details or
permission to access the data they need. Credit
investigation companies can then ask credit information
providers for the pertinent information regarding the
consent form that the information subject has signed.
 Cloud server interaction: After interacting with credit
information, the model's components now
communicate with a cloud server to upload the
information that was earlier requested, protecting the
rights and data of the credit information source. The
providers of credit information can upload data to
blockchain nodes by sending object requests, metadata,
and transaction information. Being a tamper-proof and
untraceable instrument, it has the characteristic of
always asking the user's permission before uploading
any data.
 Regulators interaction: When disclosing the results of
credit investigations to several parties, disputes are
likely to arise. Consequently, a regulatory body is
added in the model to address such conflicts and protect
the interests and rights of each member involved in the
process. This regulatory body is in charge of handling
any potential conflicts and making sure that the
interests and rights of all parties are safeguarded. This
authority is included in order to create a fair and open
system for exchanging credit investigation data that can
be advantageous for all parties while reducing the
likelihood of disagreements and conflicts.
 Communication between credit bureaus and information
agents: Credit bureaus must first have the user's consent
or authorisation before they can access the user's credit
information. Once the user has given permission, the
credit bureaus can ask the provider of credit
information to share the desired information. The
authorisation to share the particular data sought is being
used to make this request. The user's authorised
information, which includes their signature and verifies
their consent to the sharing of their credit information
with the credit bureaus, is used to make this request.
This procedure makes sure that the user has control
over who has access to their credit information and that
only authorised parties, including credit bureaus, are
given their data with their explicit authorization.
approach promotes user privacy protection and prevents
unauthorised access.
 Interaction between information agents and cloud
server: Data is encrypted before being uploaded to a
cloud server after getting a request for it and making
sure it is in the right format. Metadata and other
pertinent information are also uploaded to the
blockchain network to safeguard the interests of credit
information providers. This blockchain keeps track of
user, credit investigation agency, and credit information
provider authorization records as well as data uploads.
The blockchain is a trustworthy and dependable source
for resolving disagreements and discrepancies because
of its immutability, traceability, and multi-node
maintenance. This procedure safeguards the interests of
all parties while fostering a fair and trustworthy
environment for the exchange of credit information.
 Regulatory authorities: There is a chance that there will
be arguments or conflicts amongst the parties engaged
in the sharing of credit information. In order to resolve
any disagreements that might occur in the exchange of
credit information, the model has included a regulatory
body. To protect the rights and interests of all parties
involved in the sharing of credit information, the
regulatory body is included.
VII. ADVANTAGES
 Ensure security: Blockchain technology offers a very
safe and impenetrable method of data storage. Since the
data is spread throughout a network of nodes and each
block in the blockchain is protected by a cryptographic
hash, it is almost difficult for one party to control or
compromise the system. Federated Al further
strengthens the security of the system by enabling
numerous people to work together on it without having
to exchange sensitive data.
 Increased transparency: Data storage and sharing are
made possible by a transparent, decentralised system
made possible by blockchain technology. It is simpler
to track and confirm transactions when all system users
have access to the data. Federated AI increases
openness and efficiency by enabling several parties to
work together on the system while respecting their
privacy.
 Enhanced efficiency: Blockchain technology has the
potential to automate a number of the procedures
involved in financial transactions, resulting in a faster
and more effective transaction. Federated AI increases
the system's efficiency by allowing various parties to
contribute their computing resources and data.
 Better Access: People who are now underserved by
conventional financial institutions may have easier
access to financial services thanks to blockchain
technology. Federated AI enables several parties to
work together on the system, which can increase
underserved people' access to loans and other financial
services.
VIII. DISADVANTAGES
 Complexity: Creating and putting in place a blockchain-
based system with federated AI can be challenging and
call for a lot of resources and knowledge.
 Security Risks: Although blockchain technology has
been hailed as secure, it has historically been the target
of attacks and security breaches. Additionally, when
numerous parties are involved in the system, federated
AI usage poses questions about data security and
privacy.
 Scalability: As the network's size increases, blockchain
may face scalability problems. This can result in longer
transaction times and more expensive prices.
Scalability in general is a major problem for blockchain
technology. The system must be able to scale as the
number of users and transactions on the network rises
while preserving security, decentralisation, and
efficiency.
 Price: Building and running a blockchain-based system
with federated AI can be costly, especially if it calls for
specialised skills and infrastructure.
 Regulatory Obstacles: Because authorities may not be
familiar with the technology or unsure of how to
regulate it, using blockchain technology in financial
institutions may encounter regulatory obstacles.
 Adoption: Due to the requirement for businesses and
consumers to learn about and trust the technology, the
general adoption of blockchain-based financial systems
may be slow. This may reduce the system's potential
benefits.
IX. CHALLENGES
 Data correctness and reliability: Ensuring that the data is
accurate and trustworthy is one of the primary problems
in creating credit value information systems utilising
blockchain. Blockchain-based systems depend on the
consistency and quality of the data recorded in the
ledger, and any mistakes or discrepancies can result in
inaccurate credit scores or assessments.
 Confidentiality and privacy: Blockchain-based financial
businesses need to make sure that only authorised
parties may access the personal data of their customers.
This can be difficult, especially when exchanging data
with other people or government organisations.
 Scalability: Blockchain-based systems need to be able to
manage massive volumes of data and transactions as
they gain popularity. For some blockchain
architectures, this can be difficult since they might not
be able to scale to meet the needs of a rising user base.
 Regulatory compliance: Financial institutions using
blockchain technology are required to abide by all laws
and regulations, including those pertaining to anti-
money laundering (AML) and know-your-customer
(KYC). This can be difficult because the regulatory
environment is still changing and differs from one
country to another.
 Interoperability: Businesses using blockchain
technology in the financial sector may need to
collaborate with organisations using different
blockchain architectures or protocols. It can be difficult
to ensure interoperability between various systems,
especially as technology develops further.
Interoperability becomes more difficult when more
blockchain networks and protocols emerge. It might be
challenging to merge multiple blockchain networks
since they may utilise different consensus techniques,
block sizes, and data formats.
X. APPLICATIONS
 Payment processing: One of the financial industry's
most well-liked applications for blockchain technology
is payment processing. Compared to conventional
payment methods, blockchain-based payment systems
can offer faster, less expensive, and more secure
transactions. A blockchain-based payment system
called ripple, for instance, permits real-time cross-
border payments between banks and financial
organisations.
 Digital identity: Blockchain technology can be used to
build safe systems for digital identity that can be
utilised for know-your-customer (KYC) and anti-
money laundering (AML) compliance. Civic, for
instance, is a platform for blockchain-based identity
verification that enables users to safely store and share
their personal data.
 Trade finance: The usage of blockchain technology can
simplify trade finance procedures including invoice
financing and letters of credit. For instance, TradeLens,
a blockchain-based technology created by IBM and
Maersk, tracks the movement of goods and documents
in real time while lowering the risk of fraud and
mistakes.
 Asset tokenization: Using blockchain technology, assets,
such as real estate or works of art, can be tokenized and
traded more quickly and effectively. For instance, the
Polymath security token platform enables businesses to
design and issue security tokens that are backed by
physical assets.
 Insurance: Using smart contracts, the claims
management platform Etheric enables customers to
purchase and administer insurance policies,
demonstrating how blockchain technology may be used
to increase the efficiency and transparency of insurance
procedures.
XI. FUTURE SCOPE
 Increased security: Since data is dispersed over the
network and confirmed through consensus, the system
may be made more secure and fraud-resistant by
utilising blockchain technology and federated AI.
 Greater efficiency: By streamlining the credit rating
process and utilising federated AI, a blockchain-based
system can save time and money while still determining
creditworthiness.
 Increased credit availability: People who might interviewees." Technological forecasting and social change 158
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[6] Wüst, Karl, and Arthur Gervais. "Do you need a blockchain?." In 2018
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[8] Pilkington, Marc. "Blockchain technology: principles and
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security may make it possible to expand financial
services to underserved populations, thus promoting
economic growth.
XII. CONCLUSION
The article focuses on the three main pillars of business,
technology, and society that support blockchain
technology's use in banking. Blockchain technology has the
potential to have a wide range of effects on business,
technology, and society. Blockchain can help firms become
more efficient and spend less money by doing away with
middlemen in financial transactions. This may lead to a
quicker, more affordable, and more secure transaction. A
new business model and revenue stream called tokenization,
which enables the creation of digital assets that can be
traded on a blockchain, is another way that blockchain can
facilitate new business models. By offering a decentralised
and secure foundation for numerous applications, including
cryptocurrencies, supply chain management, and voting
systems, blockchain has the potential to completely change
the technological landscape. Decentralised applications
(DApps) can be created using blockchain technology and
have advantages over regular applications in terms of
security, privacy, and transparency. Our future work will
concentrate on the creation of such a framework for
blockchain adoption, with a focus on the TOP (technology,
organisational, and people) components involved in
successful blockchain adoption and enabling blockchain to
adequately support various business activists and services.
Additionally, we looked into ways to increase blockchain
use in the post-COVID-19 era and provided solutions and
best practises for organisations and people.
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