- Test focused on major Asia-Pacific economies
- Builds on success of SWIFT’s gpi system
- Banks praise potential for “24/7 clearing capability”
Payments in almost real-time are now a little bit easier to achieve thanks to a successful experiment by a major international payment services provider.
SWIFT, which works to facilitate international money transfers, said that the tests it carried out involved banks in nations across the Asia-Pacific region including Thailand, China and Australia.
Cross-border payments were demonstrated to have occurred much more quickly when SWIFT’s gpi system was embedded into domestic systems.
One result in the test saw a payment authorised from a gpi-enabled bank account in Singapore reach the recipient’s Australian account within just nine seconds. This account was also gpi-enabled.
The development builds on the introduction of SWIFT’s gpi back in 2017. Since then, half of all gpi-based payments can reach the recipient’s account within thirty minutes.
This removes the need for banks to wait until their normal operating hours begin in order to start clearing payments, as it introduces real-time payment clearing services which tend to run 24 hours a day, seven days a week.
Leaders at SWIFT said that there were several reasons to celebrate the success of the test.
“These results demonstrate two important prerequisites necessary to realise an instant cross-border payment service”, said Eddie Haddad, Managing Director of SWIFT Asia Pacific.
“First, we are able to extend the window for processing cross-border payments outside traditional business
hours.
“Second, by enabling cross-border SWIFT gpi payments via gpi members, through domestic
real-time payment systems, we are able to achieve faster cross-border payments amongst a larger
number of institutions”, he added.
The banks themselves said they were pleased with the development.
Paul Franklin, who is general manager of payments at the National Australia Bank (NAB), said that SWIFT’s work heralded a potential reduction in processing times.
“NAB is proud to have taken a lead role in the recent SWIFT instant processing proof of concept for cross-border payments into NPP. We have demonstrated the ability for customers to have access to funds within seconds and dramatic decreases in end-to-end processing times”, he said.
“It has given us an opportunity to show that our 24/7 clearing capability through NPP can be used to process international payments to other banks outside traditional RTGS business hours, which offers the potential for much later cut-off times, which is especially useful for payments originated in Asian time-zones.”
Twelve banks were involved in this test. All three of the recipient banks were based in Australia, but payments were sent from China, Singapore and Thailand.
The latest news comes just days after unconfirmed reports that SWIFT may be on the verge of partnering with cryptocurrency Ripple circulated.
Do you need to find the best international payment organisation for your needs? If so, have a look at our money transfer guides.
