The SWIFT network is one of the most popular international payment systems. They recently announced that they will use blockchain technology to reduce production costs and improve the efficiency of their services. Starting this month, SWIFT will test a system developed by Symbiont that will optimize corporate action solutions.
The many applications of the blockchain
The SWIFT international monetary system is one of the largest players in the financial world. He recently partnered with Symbiont to begin testing blockchain applications. This partnership takes place with the company known as Symbiont, which is known for partnering with companies such as Nasdaq and Vanguard.
SWIFT provides more than just a payment system, it also creates business-to-business communication solutions. SWIFT made headlines when the network banned Russia from its payment system.
SWIFT hopes to implement blockchain solutions to simplify communications between many parties. This includes sharing information on listed companies such as dividends, mergers and more. All this information needs to be shared quickly among all participants, which is why SWIFT wants to use a blockchain.
If the SWIFT experiment is successful, more than 11,000 institutions around the world will benefit from the enhancements offered by blockchain technology.
By replacing manual activities with automated processes, Symbiont’s new system will have a positive impact on the costs of various business actions. SWIFT estimates that 30% of these costs come from manual activities. By improving efficiency, reliability will increase and costs will decrease.
Although some financial institutions are reluctant to invest in cryptocurrency, they have recognized that the resulting technologies are valuable. That’s why a pilot group started developing this experimental system to start testing this month.
Just recently, bank BNP Paribas announced that it is using JP Morgan’s Onyx to symbolize bonds. Earlier this year, Forge, an internal startup of Société Générale, partnered with Metaco to develop blockchain solutions.
Swift: a world-renowned company
Swift is a Belgium-based company that connects a large number of high-profile financial players globally. It is considered the heart of globalization and the financialization of the economy. With its central role in the “financial planet”, Swift is also seen as an indicator and vector of globalization. Its importance was demonstrated with the Russian sanctions of 2022: they proved that Swift was an integral part of the financial planet.
SWIFT stands for Society for Worldwide Interbank Financial Telecommunication. It is a private company under Belgian law. SWIFT offers secure messaging through a platform, communication standards and a variety of additional services and products.
The network acts as a conduit for information relating to bank transfers. It has no real competitors for transactions made in countries that are not part of continental clearing systems such as SEPA.
The Swift messaging service transmitted over 10 billion payment orders globally in 2021. Nearly 50 million orders were sent through the service daily.
SWIFT reports to a partner of a bank that a transaction has been carried out on it. This allows the bank to give and receive credit. Since SWIFT does not actually carry out the transfer of funds, it involves a third party bank which is partner of banks A and B to carry out the transfer. SWIFT confirms the stability of its network with its importance in the global financial system.