Confidential Distributed Ledgers for Online Syndicated Lending

Wang, Le
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University of Guelph

With the boom of Fintech in emerging markets, online syndicated lending enables Internet borrowers to apply for loans through an agent bank and receive the result within seconds. It is of great significance to build a trusted, fair, and regulation-complaint collaboration model while maintaining confidentiality to protect the sensitive financial information of individual syndicate lenders. In this paper, we present a novel collaborative financial ledger for online syndicated lending. The proposed ledger-enabled MPC leverages homomorphic encryption to enable the efficient reuse of intermediary data without breaking the privacy during the full life-cycle of a loan. Our system further minimizes the privacy leakage in the settlement phase by carefully aggregating daily loan share and repayment information. Besides, our framework enables the regulator to efficiently verify the encrypted transactional activities. We streamline the framework design to optimize performance for the real-world requirements and develop a prototype system on a permissionless blockchain platform.

online syndicated lending, distributed ledgers, confidentiality, friendly-regulation