Blockchain Pilot On Interbank Reconciliations Launched By Italian Banking Associationbr>
The Italian Banking Association (ABI) has launched a blockchain pilot on interbank reconciliations with 14 local banks.
The trial will be run by ABI Lab, the Italian research and development center for banking technologies, and will be using R3’s blockchain Corda platform. The goal is to bring more visibility to exchange of interbank transactions, verifying the matching of correspondent accounts and highlighting discrepancies for automated remediation.
The 14 local banks participating in the project include: Banca Mediolanum, Banca Monte dei Paschi di Siena, Banca Sella, BNL BNP Paribas Group, Banca Popolare di Sondrio, Banco BPM, CheBanca!, Mediobanca Group, Credito Emiliano, Crédit Agricole, Credito Valtellinese, Iccrea Banca, Intesa Sanpaolo, Nexi Banca, Ubi.
In December 2017, ABI partnered with NTT Data to develop the proof-of-concept (PoC). It is now collaborating with SIA, the blockchain startup behind Siacoin, for the node network and verification procedures. ABI said the new process will make bilateral channels available through which each counterparty can exchange information via a series of smart contracts providing real-time feedback on transactions passing over the network.
“Through the use of the blockchain platform and the implementation of smart contract, it will be possible to provide automatic feedback on bank transactions, thus simplifying and accelerating the reconciliation process,” ABI said.
Participating banks will leverage the PoC to verify how the application of blockchain can improve certain specific aspects of their current operations. These include the time needed to identify transactions between banks that do not match, the lack of a standard process and a single communications protocol, and the limited visibility of the transactions between parties.
After the initial test phase, ABI said the pilot will be extended to a larger number of banks.