It’s no secret that SWIFT, the world’s largest money transmittal service, has begun to lose some of its market control. As blockchain technology evolves and is shown to be an efficient and inexpensive alternative to traditional payment streams, it stands to lose an even larger percentage of its position. Now, SWIFT may be considering the integration of the blockchain and has announced that it will trial a new payments gateway with Ripple competitor, R3.
According to a press release, SWIFT states that it is working on a new “gpi Link” gateway that will “enable trade platforms to offer fast, secure and transparent of payments” by GPI banks using R3’s Corda platform. GPI stands for Global Payment Initiative and was created by SWIFT last year to facilitate quicker, more transparent cross-border payments.
SWIFT is currently conducting a proof-of-concept (PoC) to connect gpi Link with its SWIFT gpi. The initial stage of the PoC is being administered on Corda and hopes to add SWIFT gpi’s traits to distributed ledger technology (DLT)-enabled trade. SWIFT states that the PoC will benefit DLT commerce, giving it the support of mainstream financial channels and by offering what it dubs “off-ledger” payment settlements based on the SWIFT gpi.
In the press release, the chief marketing officer for SWIFT, Luc Meurant, asserts, “All trade platforms require tight linkages with trusted, fast and secure cross-border payments mechanisms such as gpi. While DLT-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. With gpi Link, banks will be able to provide rapid, transparent settlement services to e-commerce and trading platforms, opening up whole new ecosystems to the speed, security, ubiquity and transparency of gpi and enabling them to grow and prosper in the new digital economy. Given the adoption of the Corda platform by trade ecosystems, it was a natural choice to run this proof of concept with R3.”
The PoC is being led by a group that consists of both corporations and banks. An initial prototype is expected to be introduced during the SWIFT International Banking Operations Seminar (Sibos), which will be held this September in London.
R3 CEO David E. Rutter adds, “Following the recent launch of our Corda Settler, allowing for the payment of obligations raised on the Corda platform, it was a logical extension to plug into SWIFT gpi. 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.”
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