SWIFT Reveals Success, Future Challenges Of Blockchain PoC

8. March 2018.








SWIFT has offered another update on its blockchain proof of concept (PoC), reiterating its potential to enrich transaction data, support real-time liquidity management and reconciliation and more.

In an announcement on Thursday (March 8), SWIFT said its DLT (distributed ledger technology) PoC for Nostro reconciliation went “extremely well,” according to SWIFT Head of Research and Development Damien Vanderveken in a statement.

“The DLT sandbox enabled us to control access, to define and enforce user privileges, to physically segregate confidential data and store it only with the relevant parties while supporting a strong identity framework by linking all participants to their BI and having all keys signed by a SWIFT certification authority,” added Vanderveken.

The PoC includes 34 banks, each with their own node in SWIFT’s DLT sandbox. The solution deploys Hyperledger to assess the potential for blockchain to enhance bank-to-bank transactions.

“The PoC sought to assess whether DLT, combined with SWIFT assets, would meet industry-level governance, security and data privacy requirements, whether DLT could bring concrete benefits over other architectures and to check DLT’s current level of maturity to serve as a production-grade application within a mission critical global infrastructure,” SWIFT said in its announcement.

The tool uses ISO 20022 payments messaging standards and technologies that are part of SWIFT’s gpi (global payments innovation) initiative combined with blockchain technology to enable the recording of transactions linked to Nostro Accounts.

While SWIFT said the PoC was successful, it also highlighted some challenges to adoption.

“Although the PoC demonstrated DLT could improve Nostro liquidity management and reconciliation processes, it also revealed that the prerequisites will have to be met before banks can enjoy the full benefits of switching to a DLT process,” said Vanderveken.

Among those prerequisites include migration from batch to real-time liquidity reporting, while financial institutions would have to upgrade back-office applications to enable a real-time data feed to the DLT platform.

We will be happy to hear your thoughts

Leave a reply

Register New Account
Login to Detarplus.com
Reset Password