Swift said it is attempting to join up banks in four of Asia's largest markets for a real-time payments system. The move is a bid to strike back against competitors from the blockchain industry, which is widely expected to roil payments.
Swift, the firm which governs a bank messaging system underpinning the movement of trillions of dollars daily, has held talks over a real-time payments system across Asian borders, it said in a statement. The company is talking to 13 Asian and Australian banks, including several of the largest lenders in China, where digital payments like WePay and Alipay are pervasive.
The Brussels-based body is responding to being undercut by cheaper and faster payment methods, such as Ripple, from the blockchain industry. With Swift's lock on cross-border payments under threat by upstarts, it launched its so-called gpi technology last January.
The banks Swift is talking to about developing a cross-border payments network include ANZ, Bangkok Bank, Bank of China, China Construction Bank, China Guangfa Bank, Commonwealth Bank, DBS, ICBC, Kasikornbank, NAB, Siam Commercial Bank, UOB and Westpac.
U.S.-China Corridor
The gpi system, which also taps blockchain's distributed ledger technology, already makes for nearly 10 percent of all Swift payments across borders. In payments traffic between the U.S. and China, the technology already makes for nearly one-third of transactions.
«ICBC believes that the efficiency of cross-border payments will increase significantly and the connectivity across markets in Asia Pacific region will be highly enhanced. ICBC will integrate inner resources to push the research and development process of this service and explore the application among its overseas branches», Peng Hua, the deputy head of Chinese bank ICBC's operation management department, said in a statement transmitted by Swift.
Aussie Tie-Up?
In a first phase, Swift will roll out a real-time sub-scheme so that banks using the gpi technology can exchange and settle payments in real-time. The second phase is expected to introduce so-called gpi rails into the existing payments infrastructure in China, Singapore, Australia, and Thailand, meaning the funds can be settled immediately in the four markets, even among banks which haven't adopted gpi.
Further out, Swift wants to link domestic banks up with gpi so the institutions can settle payments in real-time with their clients. For now, the gpi participants in those four markets have begun defining the real-time scheme for review and testing. Swift said it is also talking to the New Payments Platform, or NPP, a recently-launched system in Australia to simplify and ease transactions, about enabling the gpi scheme.
