SWIFT’s Network Gains a Blockchain Boost from R3’s Cordaby Fintechnews Switzerland January 31, 2019
The SWIFT messaging network—an entrenched establishment mainly known for cross-border interbank transfers— is integrating blockchain from R3 into its processes. This is the corporation’s bid to speed up its processes, create more ubiquity, and bring in the general trade certainty that comes from being on distributed ledger technology.
R3, made up of a consortium of financial institutions with an eye on blockchain, built an open-source blockchain named Corda, designed to grease costly business transactions by helping instutions transact directly using smart contracts, and was always built with businesses in mind. R3 has over 300 partners to date for collaboration on Corda.
With this partnership, SWIFT will be incorporating a ‘gateway’ of sorts for its Global Payments Innovation (gpi) standard for cross-border payments. The gateway, called the gpi Link, and aims to connect gpi memebers to multiple trade platforms.
The gpi Link is for now a proof of concept going through trials for connecting e-commerce and trading platforms, where corporations can utilise it to authorise and settle payments, thereby recording the resulting credit confirmation on the blockchain platforms upon completion. Eventually, the proof of concept will extend beyond R3’s blockchain-based trade environment into supporting other platforms.
SWIFT touts the gateway as an enabler for monitoring and control of payment flows, and also any movement of goods by those trade platforms.
Luc Meurant, SWIFT’s CMO, said:
“All trade platforms require tight linkages with trusted, fast and secure cross-border payments mechanisms such as gpi. While DLT (blockchain)-enabled trade is taking off, there is still little appetite for settlement in crypto-currencies and a pressing need for fast and safe settlement in fiat currencies.”
“Given the adoption of the Corda platform by trade ecosystems, it was a natural choice to run this proof of concept with R3.”
David E. Rutter, CEO of R3 said:
“SWIFT gpi has rapidly become the new standard to settle payments right across the world. All the blockchain applications running on Corda will thus benefit from the fast, secure and transparent settlement provided through the SWIFT gpi banks.”
SWIFT gpi, supported by more than 50 banks across the globe, is making big strides in innovating their cross-border payment offering. In fact, SWIFT claims that cross-border payments can now be typically made within minutes or even seconds, with over 50 per cent of SWIFT gpi payments credited to end beneficiaries within 30 minutes.
Time will tell if their efforts will be fruitful enough for them to retain their position, with Ripple ready to pounce with its decentralised platform at the slightest opportunity.
SWIFT’s proof of concept will include banks and corporate participants. A prototype will be demonstrated at Sibos in London in September 2019.
Featured image edited from Unsplash