The trial, dubbed “Making Money Smart,” has been jointly developed by the Commonwealth Bank of Australia (CBA) and Data61. The latter is a digital innovation center that forms part of the Commonwealth Scientific and Industrial Research Organisation (CSIRO) — an Australian government corporate entity that undertakes scientific research to advance diverse local industries.
In CSIRO’s press release, Data61 has defined smart — or programmable — money as currency that “knows what it can be spent on, who it can be spent by, and when it can be spent”: a blockchain-enabled digital token that can be used for payments according to binding, pre-specified rules. A distributed ledger further ensures there is an immutable and auditable trail for its expenditure and circulation.
Data61 says that NDIS was chosen for the proof-of-concept as it “involves highly personalised payment conditions,” outlining how under NDIS, individuals and their carers receive specified amounts of funds to spend on various goods and services provided for by the scheme.
Using a Smart Money scheme would automate and secure the process, relieving users and service providers from needing to process cumbersome paperwork or administrative receipts.
The press release notes that the government’s Digital Transformation Agency (DTA) has been exploring a blockchain solution for welfare payment delivery since May. Data61 has emphasized that the Smart Money trial uses a token solution that could in future be integrated with Australia’s New Payments Platform.
Data61’s Dr. Mark Staples underscored that beyond its use for conditional, parametric payments in welfare systems, the technology has far-ranging potential for the business world. He noted in the press release that programmable currency can reduce friction and help firms to “create new business models and innovative ways of delivering and paying for products and services.”
Beyond NDIS, major initiatives are underway in Australia to integrate blockchain across both the government and the financial sector. This July, IBM signed a five-year AU$1 billion ($740 million) deal with the Australian government to use blockchain and other new technologies to improve data security and automation across federal departments, including defense and home affairs.