By NOPHAKHUN LIMSAMARNPHUN
As the world’s largest inter-bank network for cross-border fund transfers, Swift, founded in 1973, has evolved from its telex messaging service in the early days to the current real-time digital messaging service.
Over the past years, about 11,000 member banks worldwide have used its global standard for risk management on fund transfers across about 200 countries.
To further upgrade its service, Swift has launched the GPI platform with the first-phase objective of providing a real-time cross-border payment service among member banks to reduce settlement time to a matter of minutes on average.
According to Sharon Toh, head of Asean region, about 50 per cent of all payments on the GPI platform are completed within 30 minutes while some of the fastest cross-border payments could be done within a few seconds.
By November this year, banks and their customers can also use stop and recall features on the GPI platform for fraud prevention.
Worldwide, more than 180 major banks have used the GPI platform, accounting for about 80 per cent of the world’s total fund transfers with daily amounts of around US$100 billion.
In Thailand, Siam Commercial Bank, Kasikorn Bank, Bangkok Bank and Thai Military Bank have joined the platform. These Thai banks account for more than 70 per cent of cross-border payments for Thailand.
By year-end, up to 14 Asean and Thai banks are expected to be on this platform whose next phase is to integrate retail and other domestic payment features into the real-time cross-border payment network.
The Thai government-sponsored PromptPay service is cited as an example for integration so as to help enable Thailand’s digital economy and society.
Swift is also working with counterparts to integrate retail-sector payments in Singapore, Thailand, Australia and China into the cross-border real time payment platform to enhance availability, speed, security, and reliability.
However, fees vary from market to market as member banks set their own charges.
Besides retail-sector payments, Swift also aims to integrate corporate-sector and SME payments into the cross-border platform, covering Singapore, Thailand, Vietnam and Indonesia in the initial stage.
According to Swift, both “inwards and onwards” payments can be settled in real-time in each of these markets, irrespective of whether the final beneficiaries hold accounts at banks that are connected to Swift or that are using GPI.
By adding the hyper-ledger blockchain technology on top of its infrastructure, member banks’ accounts are reconciled in real time for fund transfers, resulting in benefits such as greater transparency, trace-ability, tracking ability and security since messages on the blockchain cannot be altered without concensus authorisation.
Earlier, Swift also has held talks with banks in Asia Pacific region, including 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 cross-border real-time payments system based on GPI.
According to Eddie Haddad, managing director of Swift Asia Pacific, the widespread adoption of domestic real-time payments systems in the region and a cross-border real-time service is both a natural extension for GPI and a game-changer for bank customers.
In this context, Swift helps 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.