R3 Consortium Develops DLT Solution for International Paymentsbr>
Consortium R3 has developed a blockchain-based system for cross-border payments based on Corda, its distributed ledger technology (DLT) software. The solution prototype will be out by the end of this year.
R3, along with 22 of its member banks, specifically designed the solution to interact with central banking systems’ digital currencies as they are created. R3 said the project is well-suited specifically for this purpose because it has been designed to create a ledger representing various fiat currencies.
The solution aims to improve world trade efficiencies by facilitating instant international payments. The solution will offer a direct alternative to current systems that can take days to complete an international payment, costing businesses millions, slowing down trade, increasing settlement and fraud risks, and causing a liquidity drain for banks.
The project is the outcome of over two years of intense research and development by R3 and its 100+ members. Banks involved in the project include Barclays, BBVA, CIBC, Commerzbank, DNB, HSBC, Intesa, KBC, KB Kookmin Bank, KEB Hana Bank, Natixis, Shinhan Bank, TD Bank, US Bank and Woori Bank.
R3 CEO David E. Rutter said that international payments systems have struggled to keep pace with the explosion of global trade and the globalization of the world’s markets. He said the project marks a significant milestone for DLT as they work to harness its unique attributes to build the world’s first true international payments system.
“This solution will be a game-changer for any bank or company whose business relies on making or receiving cross-order payments, and is a key part of R3’s wider strategy to leverage distributed ledger technology for faster and more efficient execution of all types of financial transaction,” said Rutter.