SAP, R3 Back Blockchain For Real-Time Gross Settlement

Enterprise software firm SAP is teaming up with professional services firm Accenture and blockchain company R3 to develop a distributed ledger technology (DLT) solution that aims to accelerate the settlement of payments between banks and customers.

A press release issued on Thursday (Oct. 24) said the companies are collaborating on a payment platform designed to accelerate payments and settlement between banks and their customers, with a focus on allowing for interoperability between existing real-time gross settlement (RTGS) systems and blockchain-based systems.

The firms have created a prototype, they said, which uses currency tokens to support end-to-end settlement; currency tokens, as opposed to digital currencies, operate as a proxy for central bank fiat currency.

The prototype uses SAP’s Payment Engine application to initiate, process, clear and settle transactions. The solution integrates into R3’s Corda distributed ledger platform to support interaction of the solution with existing RTGS systems. Accenture is providing its experience in central bank clearing and settlement, as well as blockchain, to support banks’ adoption of the tool.

In their announcement, the companies said the payment solution provides the kind of flexibility in payment ecosystems that is necessary to integrate emerging payment technologies without forcing banks to change current payment formats.

“Because the current payment settlement infrastructure is highly complex and fragmented, RTGS systems that leverage DLT and cryptographically secure tokenized payments can help central banks improve efficiency and security,” explained Accenture Managing Director and Global Blockchain Technology Lead John Velissarios in a statement. “The RTGS prototype, designed in collaboration with SAP and R3, demonstrates the next stage of efficiency in payment systems and, ultimately, paves the way to linking tokenized assets, like equities, to create an increasingly integrated and seamless financial services ecosystem.”

In another statement, SAP’s Global Head of IBU Banking Falk Rieker said that “the RTGS platform is designed to enable banks and payment providers to easily adopt and integrate DLT-based payments on their existing platforms, helping banks to safeguard as well as augment the value of their investments.”