South Africa’s Standard Bank to launch permissioned blockchain payment system

South Africa-based Standard Bank is planning to launch a permissioned blockchain payment system for conducting overseas foreign exchange trades on behalf of its corporate clients, Finextra reported.

Standard Bank Group is the largest African banking group by assets, with a market cap of approximately R310 billion (USD23 billion).

Built on the Hyperledger Fabric, the platform is expected to go into live production in the latter half of the year. It will initially cover Standard Bank and Stanbic Bank partner banks, clients and third parties directly involved in trades, and interbank network Swift.

“We have also decided to include our foreign currency trading app, Shyft, which provides access to a host of payment distribution partners and e-commerce platforms,” says Richard de Roos, head of foreign exchange for Standard Bank.

Once live, the platform is expected to considerably increase the straight-through processing of international trades. It will help expedite the process of foreign exchange payments and settlement, while enhancing transparency, “providing an independent and much safer cloud-hosted record of all documents and steps, instantly available in real time to all parties involved,” de Roos said.

"We could actually offer clients a fully integrated end-to-end block chain solution that would dramatically reduce the incidence of trade failure while also increasing regulatory transparency and improving the visibility of liquidity,” he added.

In addition, the bank is working with the Industrial and Commercial Bank of China (ICBC) to extend the platform into China.

The network is conceived on a hub and spoke basis, “where the hub is Standard Bank and its 20 franchises across Africa working with ICBC to extend the hub into Asia, and the spokes are the various payment rails, like Swift and Shyft,” de Roos added.

In October 2018, Standard Bank participated in a pilot that involved using the Quartz Blockchain technology for cross-border corporate action information exchange using the TCS BaNCS Network.