Fourteen Italian banks completed the first phase of a blockchain trial for interbank reconciliations. Following the pilot, the project is now moving into the next stage. The initiative is led by ABI Lab, the innovation hub at the Italian banking association or Associazione Bancaria Italiana (ABI).
The project aims to provide improved transparency, speed up execution, and perform checks.
Reconciling Interbank transactions is a complex process, where the two banks on each side of a transaction try to make sure they agree. Currently, if both ends don’t agree, then it’s time-consuming to resolve discrepancies.
Blockchain helps to quickly identify transactions that don’t match and enables the development of standard processes and communications. Hence, the net effect is enhanced transparency.
R3’s Corda is the technology solution. Hence each pair of banks can communicate and share information with each other in a private manner. The only data that exists on a bank’s node involves transactions to which the bank is a party. Automatic feedback is provided on the transactions to each party.
NTT Data is the developer and Italian enterprise network company SIA is providing the network infrastructure. The Italian company also supports 40% of SEPA transactions which is the primary payment mechanism in Europe.
The banks in the consortium are: 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, and Ubi.
In Japan, SBI Ripple Asia is about to launch the initial phase of an interbank transfer network for Japan, using Ripple technology. The purpose is to expand the hours during which bank transfers can be made in the country. Ripple and R3 recently settled