A consortium of Italian banks has successfully completed the initial trial of a blockchain-based system aimed at enhancing interbank operations.
Known as the interbank Spunta Project, the 14 banks chose the Corda distributed ledger technology platform developed by the R3 blockchain consortium. The application was developed by NTT Data Italia while decentralized storage platform Sia provided the node infrastructure. During the trial phase which lasted for a period of 10 months, around 1.2 million transactions were processed, according to Ansa.
Speed, Efficiency and Transparency
Some of the improvements expected to be made using the blockchain solution include boosting transparency, speeding up processing times and enhancing efficiency with regards to the exchange of information and verification of details. At the time when the trial was announced last year in December, the CEO of R3, David Rutter, indicated that these were the goals:
“Working with ABI Lab we are using Corda to automate the matching process, helping Italian banks avoid mismatches and improve efficiency and accuracy across the board. This PoC [proof of concept] will demonstrate how easy it is for banks to reduce their operational and back office costs, while saving time and communicating securely by utilising DLT.”
The Spunta Project is being operated by ABI Lab, the research and innovation center of the Associazione Bancaria Italiana (loose translation – Italian Banking Association) . In the next phase of the project, blockchain applications will be used by the banks in everyday transactions.
The 14 banks falling under the umbrella of the ABI include Italy’s second largest bank Intesa Sanpaolo, Credit Agricole (the ‘green bank’), Banco BPM, BNL (Gruppo BNP Paribas), Banca Mediolanum, Banca Monte dei Paschi di Siena, Banca Popolare di Sondrio, Banca Sella, CheBanca (Gruppo Mediobanca), Credito Emiliano, Credito Valtellinese, Iccrea Banca, Intesa Sanpaolo, Nexi Banca and Ubi.
Inter-Country Financial Transactions
Besides its use in interbank operations, the open source Corda platform has also been employed in cross-border payments, as previously reported by CCN. Last year in October, for instance, 22 member banks including Barclays, BBVA, Commerzbank, DNB, HSBC, ICBC, Intesa, KBC, KB Kookmin Bank, KEB Hana Bank, Natixis, Shinhan Bank, TD Bank, U.S. Bank and Woori Bank joined hands with R3 with a view of enabling international payments.
Rutter at the time hailed it as highly disruptive for organizations that do business across borders.
“International payments systems have struggled to keep pace with the explosion of global trade and the globalization of the world’s markets…” said Rutter. “This solution is a game-changer for any bank or company whose business relies on making or receiving cross-border payments.”
Featured image from Shutterstock.