SWIFT uses blockchain for cross-border payments gateway trial

The gpi Link proof of concept will use R3's Corda distributed ledger technology.
Written by Asha Barbaschow, Contributor

Financial messaging service SWIFT has announced a new proof of concept (PoC) that will trial its gpi Link gateway that interlinks e-commerce and trading platforms with the SWIFT gpi, using R3's Corda distributed ledger technology (DLT).

Gpi Link, SWIFT explained, will connect gpi members to multiple trade platforms to enable gpi payment initiation, tracking, payer authentication, and credit confirmation.

The first stage of the PoC will work on R3's Corda blockchain.

"The [proof of concept] addresses the need for DLT-based commerce to be supported by global, fast, secure, and transparent settlement using fiat currencies by enabling 'off-ledger' payment settlement based on gpi," SWIFT said of the trial.

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According to SWIFT, organisations using the R3 platform will be able to authorise payments from their banks via gpi Link. Gpi payments will be settled by the organisation's banks, and the resulting credit confirmations will be reported back to the trade platforms via gpi Link on completion.

"All trade platforms require tight linkages with trusted, fast, and secure cross-border payments mechanisms such as gpi," SWIFT's Luc Meurant said in a statement.

"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.

"Given the adoption of the Corda platform by trade ecosystems, it was a natural choice to run this proof of concept with R3."

R3 comprises a consortium of financial institutions whose distributed ledger offering, Corda, is not structured as a typical blockchain, meaning that transaction data is not published to the ledger of every participant in the network. Instead, transactions are published only on the ledgers of the relevant parties.

The PoC will initially address R3's DLT-based trade environment, and SWIFT said it plans to extend the trial to support other DLT, non-DLT, and e-commerce trade platforms.

According to SWIFT, its SWIFT gpi currently enables over $300 billion-worth of payments every day, with over 50 percent of its cross-border payments made in less than 30 minutes.


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