The results are in for an early proof-of-concept test at Swift with six of the cooperative’s member banks.
By all indications, it seems the DLT application can deliver the business functionalities and data richness required to support real-time liquidity monitoring and reconciliation.
Proof of concept is based on Hyperledger Fabric v1.0 technology and is part of the Swift gpi initiative to ramp up efforts within the correspondent banking system to ready it for the coming era of technological disruption.
Early results indicate that DLT provides real-time visibility to both the account owner and its servicer on the available and forecasted liquidity of the Nostro account.
The test also found that DLT supports payment reconciliation and investigations by providing an enriched data model based on ISO 20022.
“Significant progress has been made, but it is still early days for the latest generation of blockchain technology, and it will take time before it is mature and scalable enough for mission-critical applications,” said Damien Vanderveken, head of research and development. Vanderveken is on the whole positive about the results — but urges caution, as the development process has many challenges ahead.
Swift, for example, has noted it must find unique value propositions in response to the different levels of sophistication, automation and past investments of banks. Part of that, notably, is working with legacy back office applications and co-existence with existing processes — both of which are a steep challenge.
And Swift’s worldwide partner banks are diverse — making a one-size-fits-all solution especially challenging.