Temasek, DBS, J.P. Morgan To Launch Blockchain-Based Payments Firm
DBS, JP Morgan and Temasek announced today (April 28) their intention to develop an open industry platform for payments, trading and currency settlement through a newly formed technology company.
Called Partior, it aims to disrupt the traditional model of cross-border star payments, which is generally expensive and time consuming due to multiple validations of payment details by banks.
Partior aims to meet the need for efficient digital clearing and settlement solutions in the banking industry and aims to address these challenges through the use of blockchain solutions.
The Partior platform seeks to develop wholesale payment rails based on digitized commercial bank money to enable “atomic” or instant settlement of payments for different types of financial transactions. This would help banks overcome the challenges posed by the current method of processing global payments.
The platform will begin by focusing on facilitating flows primarily between Singapore-based banks in USD and SGD, with the aim of expanding service offerings to other markets and in various currencies.
Partior’s platform will also be designed to complement ongoing Central Bank Digital Currency (CBDC) initiatives and use cases.
Banks will be invited to join the platform
The operation of Partior by DBS, JP Morgan and Temasek and the completion of the development, launch and availability of the services on the proposed platform are subject to obtaining all required regulatory consents and approvals.
Once completed, the platform aims to provide a 24/7 infrastructure that will allow financial institutions and developers to co-create applications supporting use cases such as FX Payment Versus Payment (PVP), Delivery Versus Payment (DVP) and Peer-to-Peer. escrows to complement and add value to global financial ecosystems.
“The current star arrangement in global payments often results in delays, as confirmations from various intermediaries are required before a settlement is considered final. This in turn has a ripple effect and creates inefficiencies in the final settlement of other assets, ”said Piyush Gupta, CEO of DBS Bank.
“By harnessing the benefits of blockchain and smart contract technology, the Partior platform will address current sticking points. The open platform will enable banks around the world to deliver real-time cross-border multi-currency payments, trade finance, foreign exchange transactions and DVP securities settlements on a world-class platform, with programmability, immutability and traceability integrated into its suite of services. . “
To encourage broad participation in the banking sector, Partior will actively engage leading banks to join the platform to establish the scale required to benefit the sector.
Chia Song Hwee, Deputy Managing Director of Temasek, revealed that she has attracted interest from other banks and partners and looks forward to welcoming them as this new platform grows.
These efforts by DBS, JP Morgan and Temasek build on their previous work on Project Ubin, an industry initiative of the Monetary Authority of Singapore (MAS) to explore the application of blockchain technology involving multi-currency payments and settlements.
“With its genesis of the Ubin project, Partior is a pioneering step towards providing a fundamental global infrastructure for transactions with digital currencies in a trusted environment, stimulating a wide range of use cases in the ecosystem of the blockchain ”, said Sopnendu Mohanty, Chief FinTech Officer of MAS.
Last December, DBS also planned to set up a digital exchange to help institutional and accredited investors harness fully integrated digital asset tokenization and trading.
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Featured Image Credit: Citywire Asia / Munshi Ahmed via Getty Images / Shutterstock
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