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Banking giant JPMorgan Chase is seeking to expand its blockchain project amid growing competition from payments startups such as TransferWise, Revolut and Ripple, The Financial Times reported.
Called “Interbank Information Network” or IIN, the project was launched as a pilot in 2017 with two global partners, Royal Bank of Canada and Australia and New Zealand Banking Group. Powered by Quorum – a permissioned-variant of the Ethereum blockchain, developed by J.P. Morgan, IIN aims to speed up the processing of global payments.
The project has grown to more than 220 banking members, the FT said. Previously, over 75 banks had signed up to be part of IIN in September 2018.
IIN enables correspondent banks to cut short the time spent to respond to compliance and other data-related inquiries which causes a delay in payments.
John Hunter, JPMorgan’s head of global clearing, told FT that the bank is considering expanding the functions the IIN.
“The initial use case was around sanctions screening,” he said. “Now we’re looking at the ability to do more at the point of settlement.”
Revealing further details, Hunter said that JPMorgan has developed a function that would enable real-time verification of whether a payment was going into a valid account. In the existing setup, it takes days to reject a payment due to an error in the account number, sort code, address or other details.
Real-time verification would help speed up the process. The system is expected to go live in the third quarter for both domestic and international payments. JPMorgan believes that the new function would be more useful for international payments, which has higher error rates.
Furthermore, the IIN is also setting up a fintech sandbox which would allow startups to use the network to “develop and put out applications”. Also expected to launch in the third quarter, the sandbox will offer developers building blocks such as secure messaging, document file transfer and data modelling.
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