SWIFT, the operator of the platform used by the global interbanking system, has spoken about details of its blockchain proof-of-concept (PoC) trial th
SWIFT, the operator of the platform used by the global interbanking system, has spoken about details of its blockchain proof-of-concept (PoC) trial that includes a number of global banks.
SWIFT has reportedly used the Hyperledger Fabric, a product developed by the Linux Foundation-led open-source cross-industry project that sees the collaboration of various companies – the Hypeledger Project. It is said to be the core technology for PoC.
SWIFT added that they aim to see, if blockhain technology can improve real-time reconciliation of banks` nostro accounts. These accounts enable international transactions for the global banking system. Banks park their money in nostro accounts around the world to facilitate international transactions with money available for these transfers.
According to SWIFT`s press release (available at swift.com), some of the banks participating in the PoC are Australia and New Zealand Banking Group, BNP Paribas, BNY Mellon, DBS Bank, RBC Royal Bank and Wells Fargo. These banks are said to be working with SWIFT to identify challenges, define specifications, build the application and test the concept. It is expected that an additional 20 banks will join the programme at a later stage. Thus, the concept may be further validated.
“Distributed Ledger Technology holds the potential to dramatically reduce the need for reconciliation in a shared ledger environment. BNY Mellon, a member of the gpi Vision Group and early adopter, is pleased to join SWIFT and other participating banks in exploring how DLT could streamline nostro account reconciliation in the cross-border payment process.”, said Christopher Mager, Head of Global Innovation for BNY Mellon Treasury Services.
“The nostro DLT proof of concept is deeply embedded in the SWIFT gpi story of streamlining the cross-border payments system.”, commented Wim Raymaekers, Head of Banking Markets and SWIFT gpi at SWIFT.
“It allows us to explore how this maturing technology can provide a collaborative solution to what our gpi member banks have identified as a significant pain point – nostro accounts reconciliation.”, he elaborated.
The plan is that the trial (if successful) will be introduced into SWIFT`s gpi or global payments innovation services that offers clients “fast, transparent and traceable cross-border payments.”