To reduce its production costs and improve the efficiency of its services, SWIFT, one of the leaders in payment systems, is turning to blockchain. Starting this month, the company will be experimenting with a system developed by Symbiont to optimize its securities trading solutions.
SWIFT to experiment with blockchain with Symbiont
SWIFT, one of the major players in the international monetary system, is going to start experimenting with blockchain. For this, the company has hired the services of Symbiont, whose solutions are aimed at professionals. This company is already known to collaborate with Nasdaq or Vanguard in particular.
In addition to its famous payment system, which has been in the news since the beginning of the year, excluding Russia, SWIFT also stands out for its solutions for business-to-business communications systems.
This includes sharing strategic information about listed companies, such as dividend payments and mergers. All of this important news needs to be shared quickly to all involved, and it is to streamline these operations that SWIFT is turning to blockchain:
“The automation of these communications has improved in recent years, but it still relies heavily on manual processes that create both additional costs and risks for market participants.”
In total, all 11,000 SWIFT-connected institutions worldwide will be able to benefit from the improvements brought about by blockchain technologies, if the experiment is successful.
Improving the efficiency of securities transactions
The different types of securities transactions will be most positively impacted by this new system. SWIFT estimates that 30% of the cost of these transactions is manual. In addition to improving the efficiency of processing, Symbiont’s solutions will increase reliability and reduce these costs.
Tom Zschach, SWIFT’s Director of Innovation, said:
“If the solution proves effective, intermediaries will have to respond to fewer customer requests for securities transaction data. It also means that global custodians and asset managers could reduce the number of people who spend their time manually processing corporate action data.”
For now, a pilot group is developing this experimental system to begin testing as early as this month. While financial institutions are sometimes skittish about cryptocurrencies, we are seeing real interest in the technologies that are emerging from them.
Earlier this year, Société Générale, through its in-house startup Forge, made news by partnering with Metaco to develop its blockchain solutions. Shortly before, it was BNP Paribas bank that announced it was using JP Morgan’s Onyx to tokenize bonds.