Singapore’s OCBC Bank has become the first bank in Southeast Asia to use blockchain technology in its local and cross-border payment funds transfer services.
A successful pilot payment transaction between the bank and its subsidiaries, OCBC Malaysia and the private bank Bank of Singapore, was conducted on 8 November 2016, using a payment blockchain solution jointly designed by OCBC Bank and local banking payment solutions company BCS Information Systems (BCSIS).
Banks are rapidly embracing the use of blockchain seeing it as a conduit to increase efficiency, transparency and security as well as lowering costs and delivering a better customer experience.
From 1 Day to 5 Minutes
The two pilot payment transactions were: A cross-border funds transfer between OCBC Bank Singapore and OCBC Malaysia and A local funds transfer between OCBC Bank Singapore and its private banking arm, Bank of Singapore.
Funds transfers between OCBC Singapore and OCBC Malaysia which typically require up to 1 day could be completed in less than 5 minutes.
Use of Blockchain
«MAS and the financial industry have worked hard over the past two years to build a thriving FinTech ecosystem in Singapore. OCBC’s initiative demonstrates the vibrancy of our banks in applying innovative technology to complex business problems like cross-border payments,» said Sopnendu Mohanty, Chief Fintech Officer, Monetary Authority of Singapore (MAS).
With the successful pilot, and after full integration of this payment solution, the BCSIS blockchain platform will allow inter-bank payments between banks in Singapore and overseas without requiring a payment intermediary. In addition, OCBC Bank will extend the use of blockchain technology to other financial products and service applications.
