Ripple: SWIFT to test blockchain payments

• SWIFT has partnered with Symbiont in an effort to increase the accuracy of the workflow for corporate actions.
• Since SWIFT already works with Ripple, some speculate that the partnership will involve Ripple and XRP.

The Society for Worldwide Interbank Financial Telecommunications (SWIFT), the world’s leading provider of secure financial messaging services, has used Symbiont to help it improve operational efficiency in non-revenue-generating activities for thousands of users worldwide.

According to an announcement on Tuesday, Symbiont, a leading technology company focused on providing turnkey solutions for complex global financial problems using blockchain, will help SWIFT increase the accuracy of its business transaction workflow.

With global transactions, interconnection and corporate workflows becoming more complex, automated communication on issues such as dividend payments, mergers, exchange offers, auctions and other corporate actions has become a necessity.

Leveraging Symbiont’s enterprise blockchain platform, SWIFT will enable institutional partners to share critical information with investors, creditors and other stakeholders in real-time, reducing over 30 percent in costs and minimizing risk to market participants.

Under the new partnership, business transaction data from SWIFT messages will be translated by SWIFT Translator and uploaded to Symbiont’s blockchain. Their smart contract technology can then compare information shared between participants and flag discrepancies, contradictions or inconsistencies across custodians in real time.

“By bringing Symbiont’s assembly and smart contracts together with SWIFT’s extensive network, we are able to automatically harmonize data from multiple sources into a corporate action event,” said Tom Zschach, Chief Innovation Officer at SWIFT. The program will be tested over the next two weeks and will greatly benefit SWIFT’s over 11,000 institutions across 200 countries if all goes well.

This is the latest move by SWIFT in its bid to harness the power of blockchain technology as it seeks to go beyond transmitting financial news. Previously, the money transmitter has stated that it wants to “fundamentally renew its cross-border infrastructure for processing payments and securities transactions” and has embarked on various ventures aimed at onboarding blockchain technology.

Not an easy route

However, its ambitious plan puts it in tough competition with players like Ripple. The blockchain route as an alternative to SWIFT has been brewing since around 2016 when Ripple publicly challenged SWIFT on cross-border payments. Already, Ripple, the blockchain company behind XRP, has skipped cross-border payments through its book-first infrastructure. The blockchain firm also has a war chest of partners including Moneygram, Brazilian bank Travelex and Arab behemoth coss-boarder payment service provider Tranglo.

Apart from increased security features, Ripple boasts significantly faster payment speeds of around 4-7 seconds and hugely cheap fees that put it ahead of other service providers. Despite SWIFT being a major hub for global finance and appearing ripe for disruption, the upgrade to blockchain may prove delayed given its largely outdated infrastructure.