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SWIFT investigates Asia Pacific cross-border gpi real-time payments


SWIFT and a group of banks from Australia, China, Singapore and Thailand participating in its global payments innovation (gpi) project are exploring a cross-border real-time payments (RTP) service in Asia Pacific.

Exploratory talks have been held with Asia Pacific banks, such as ANZ, Bangkok Bank, Bank of China, China Construction Bank, China Guangfa Bank, Commonwealth Bank, DBS, ICBC, Kasikornbank, NAB, Siam Commercial Bank, UOB and Westpac about the development of a regional supranational real-time payments system.

How instant the proposed solution based on SWIFT’s evolving gpi platform will be in terms of sub-10 second delivery speeds is not immediately apparent, but it would certainly be fast and potentially a useful new regional infrastructure. The participants, gathered at a SWIFT workshop, claim such a service would have significant benefits extending beyond gpi participants and their bank customers, deep into the domestic markets. Then aim is to eventually achieve a complete real-time cross border payments experience for all bank customers in the region, according to a statement. Time will tell if it reaches ubiquity or faces any rivals.

The mooted project would be rolled out in three phases:

  • Phase 1 will see the introduction of a new real-time gpi sub-scheme, to facilitate real-time cross-border payments between gpi banks in the region. This would build on the existing global SWIFT gpi payments happening regionally in minutes and deliver a specific regional real-time settlement capability for cross-border payments between signatory gpi banks.
  • Phase 2 will effectively extend the SWIFT gpi rails into existing real-time payment systems within each recipient country, thus ensuring that ‘inwards and onwards’ payments can be settled in real-time in each of the four markets – irrespective of whether the final beneficiaries hold accounts at banks that are connected to SWIFT or are using its gpi ‘product’.
  • A third phase would look to link domestic real-time payment systems via SWIFT gpi to facilitate full cross-border real-time payments between their respective customers. This final stage, with an unspecified start or end date, aims to enable the sending and receiving account holders to benefit from a full RTP experience. Again, this would be independently of whether they held accounts at banks that are connected to SWIFT or use its gpi quasi-new messaging standard.

SWIFT’s gpi Tracker, which effectively allows banks to track payment messages around the world in the same way a logistics company would a package, is already live. The Tracker is one of the first uses for its quasi-new messaging standard that retains remittance information regardless of whatever national, domestic infrastructure it runs over. The innovation means that at long last, UBS can track a payment message in the same way UPS would a parcel.

Commenting on this spin-off regional proposal, Eddie Haddad, Managing Director of SWIFT Asia Pacific, said: “With the widespread adoption of domestic real-time payments systems in the region, a cross-border real-time service is both a natural extension for SWIFT gpi in Asia Pacific and a real game-changer for bank customers. SWIFT is uniquely positioned to help our customers leverage their existing investments in infrastructure, to standardise connectivity across multiple markets and to drive efficiencies in support of cross-border trade, facilitating further integration in the ASEAN region.”

Following the initial workshops, SWIFT and participating gpi member banks have begun work on defining a common cross-border real-time regional scheme that banks can review and test. The design of the new service will build on existing SWIFT gpi service rules to help resolve additional business process frictions in the payments chain. SWIFT has also commenced discussions with the New Payments Platform (NPP) in Australia to enable SWIFT gpi payments to be processed onwards through their newly launched domestic real-time payments system. SWIFT helped to design and build the NPP.

Launched in 2017, gpi already accounts for nearly 10% of SWIFT cross-border payment traffic. It is enabling more than a hundred billion dollars to be transferred across the world rapidly and securely every day. More than 160 banks, including 48 out of the 50 top banks on SWIFT, have signed up to the service, says the organisation, sending hundreds of thousands of payments daily across 350 country corridors, including major corridors such as USA-China, where gpi already accounts for more than 30% of payment traffic.

“SWIFT gpi already reduces cross-border payment times to minutes, even seconds and indeed nearly 50% of gpi payments are already being completed in less than 30 minutes,” said Haddad. “This new scheme will further speed up those payments and extend the reach of the gpi capability far deeper into domestic markets, driving radical change in the cross-border payments market across the region. We look forward to seeing this work in practice and to more countries, and banks joining the new service.”



Author: Neil Ainger