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advisory

First digital surety bond at blockchain: Passadore Bank inaugurates platform with Nexi and Reply

17.10.2024
They say about us

In September 2024, the Digital Sureties platform, developed by Cetif Advisory in collaboration with Nexi and Reply, became operational in the Italian market. This platform aims to digitize the entire life cycle of surety bonds, making it possible to notarize them at blockchain, ensuring greater transparency and security in operations. The blockchain is a key tool for certifying and tracking the veracity of sureties, eliminating risks of forgery. The first banking institution to upload a surety bond to the platform was Banca Passadore, in October 2024. Through this upload, the bank started the process of notarizing the surety bond on blockchain. This system allows public verification of the validity of surety bonds through an online section, making the information accessible to interested parties. This innovative mechanism solves several problems related to the lack of transparency in traditional transactions.

Platform development: a five-year journey

The Digital Sureties platform project originated in 2019 with the identification of a number of issues that characterized the surety bond industry, including:

  • Low digitization: the process of managing surety bonds was still highly manual and not very standardized.
  • High risk of fraud: lack of traceability made it difficult to prevent and combat fraud.
  • Ineffective management: the absence of a centralized structure for managing surety bonds complicated the monitoring and updating of information.

In 2020, an experimental phase was launched with 29 participants including banks, insurance companies, consortia and associations, with the aim of developing an MVP (Minimum Viable Product) for the digitization of surety bonds through blockchain. The technology chosen was Blockchain Corda R3, provided by Nexi, a leading European PayTech in the field of digital payments.

Next steps: industrialization and regulatory compliance

After the conclusion of the testing phase in December 2020, it was decided to move on to the industrialization of the platform, which required further functional, legal and technical analysis between February and December 2021. This work led to the realization of the final version of the platform, ready to be integrated into the financial market. In 2023, the introduction of the New Procurement Code required an update of the platform to comply with the new Italian regulations. Further changes were made in response to AGID (Agenzia per l'Italia Digitale) requirements, ensuring that the platform was fully compatible with national standards. In June 2024, the ANAC (National Anti-Corruption Authority) circular confirmed the need for a digital platform capable of tracking and certifying all phases of surety bond management, ensuring notarization at blockchain and full transparency.

Benefits offered by notarization on blockchain


Notarization of surety bonds at blockchain offers several benefits, including:

  • Data immutability: recorded information cannot be changed or deleted, ensuring the integrity of the document.
  • Traceability: each stage of the surety's life cycle is transparently monitored and recorded.
  • Security: through the use of encryption, the risk of fraud is drastically reduced.
  • Efficiency: digitization speeds up the entire process, reducing management time and operating costs.

In addition, thanks to a pec to pec handling mechanism, the platform allows the guarantor to obtain a 10 percent discount on the guaranteed amount even before the maturity date set for December 31, 2024.

Collaboration between Nexi, Reply and Passadore Bank

Nexi 's role as a technology partner was crucial to the development of the platform. Nexi invested in the technology blockchain to provide an innovative, secure and scalable solution capable of meeting market needs. Reply, another strategic partner, contributed its technical and functional expertise, ensuring that the platform was configurable according to the needs of each user. The Digital Sureties platform represents a major step forward for the financial and insurance industry, providing a tool that enables easier and more secure management of surety bonds. This innovative approach not only prevents fraud, but also reduces operational risk, improving overall process efficiency. With these features, the platform could become a standard for the digital management of surety bonds in Italy.