Swift CEO Announces Partnership With Blockchain Startup R3

Swift CEO Announces Partnership With Blockchain Startup R3

Swift, the global provider of secure financial messaging service is about to have collaboration with a distributed ledger technology company named as “R3”. As a part of the tie-up, Swift will link R3 platform with its new payments standards framework GPI or Global Payments Innovation, according to Gottfried Leibbrandt, Swift’s chief executive.

Leibbrandt, on Wednesday (30th Jan 2019) at the CNBC-hosted panel session mentioned that “We are announcing later today a proof-of-concept with the R3 blockchain on trade where you can initiate a payment on the trade platform and then it goes into GPI.” He further added that “We’re exploring interconnectivity with a lot of things and banks have always been a part of that interconnectivity.”

Swift, believe that GPI technology can keep track of end-to-end tracking of transactions in real-time and at the same time can boost up the cross-border payments between banks.

Leibbrandt was speaking alongside the chief executive of Ripple, Brad Garlinghouse, offering tough competition to R3. The San Francisco-based start-up R3, however, has been successful in clinching business from the payments processing giant who has been operating the business from almost five decades.

Brad Garlinghouse, though shared his views at the panel discussion by saying that Ripple was looking for different ways through which they could have entered into the partnership with Swift but unfortunately, the payment processing giant neither hinted about any collaborations.

With almost 11,000 institutions using secure financial messaging service offered by Swift platform, there is no doubt in saying that Swift is the irrefutable leader in cross-border payments. Using the service an estimated $200 billion is moved around the world every day.

However, the technology being fully centralized, the Swift’s platform is expensive and a bit slow as it might take days for processing huge payments. This is what makes the platform weak versus a blockchain model that stresses decentralization, Garlinghouse said. Further adding “Decentralized systems I think over time are likely to win,” “I think that today that is not what Swift is.” “Swift today is a one-way messaging framework, it isn’t a liquidity provider,” “When we think about an internet of value, it’s a mixture of two-way messaging frameworks — moving to a real-time chatting protocol if you will — coupled with real-time liquidity.”

By signing on customers like Spanish bank Banco Santander to its xCurrent messaging system, Ripple has made waves in the payments industry in recent years. To transfer funds between its customers within seconds Ripple makes use of technology similar to that of the blockchain.