SWIFT Payment Protocol Embraces New Blockchain Initiative To Improve Its Services
- SWIFT is working with blockchain technology to improve its services and remain competitive
- Several blockchain firms have entered the financial market during the last few years
SWIFT, one of the most recognized providers of financial services around the world, announced that it is moving all in on blockchain and open finance. The main intention is to remain competitive in the blockchain market that is welcoming new participants and initiatives that could harm its market share.
SWIFT Works On New Blockchain Initiative
According to Finder, SWIFT released a new paper titled: Payments: Looking into the Future, that was written by the CEO of the company Gottfried Leibbrant and the CMO Luc Meurant. In this paper, they inform that they will be pulling all the world’s banks onto a blockchain network. This would allow third-party businesses to develop their own financial services and applications within the ecosystem.
"Spare a thought for remittance companies, Ripple, Paypal & other payment companies. Simply moving money by itself was never going to be a sustainable product. As SWIFT said, it's do or die."
Ripple welcome you, SWIFT!
— 🐼PandaRippleXRP🐼 (@RipplePandaXRP) June 22, 2019
In order for banks and financial institutions to compete in this market, it is necessary for them to use open systems. According to SWIFT, this is “do or die in payments.”
About it, SWIFT wrote:
“We don't think that cross-border payments challenges should be solved for with closed loop systems. Doing so would easily solve for a subset – or multiple subsets – of participants, but value needs to move everywhere – from every account, to every account. Loops create barriers and friction; they reduce fungibility and portability, they limit competition and they fragment liquidity.”
Banks have also to adapt to these new realities in which blockchain technology is surging and helping firms to improve their services and products. As the CEO and CMO of SWIFT explain, value needs to shift further and faster. This is why they consider only a seamless open global value transfer system can enable this.
The authors of the paper explained that there are key players around the world that have the ambition and commitment to realize the goal of improving their services by embracing new technologies. According to Finder, GPI (Global Payments Innovation) is the answer that SWIFT has to all the dust blockchain that has been growing in the last years. After trying during the last years, they have confirmed that distributed ledger technology (DLT) is going to be at their core.
With their approach, banks can differentiate themselves by layering services and new products so as to distinguish their offerings. Moreover, FinTechs and other players can also create and offer new value-added services.