Chainlink and SWIFT have rolled out a partnership for a new service to help finance institutions operate in blockchain environments, a press release said.
The companies have debuted a “Cross-Chain Interoperability Protocol” to let SWIFT messages instruct on-chain token transfers. It will help the network become interoperable across various blockchain environments.
It comes as banks have needed homogenous connectivity with finances, and SWIFT is still a core gateway for new markets.
Current financial market participants have seen troubles such as slow adoption of technological transformation because of legacy systems demanding substantial modifications. As there’s a lot of value in the systems, the cost of replacing or developing new connectivity can be high.
Chainlink and SWIFT’s collaboration will let financial institutions be more blockchain capable without needing big upfront costs or development time.
In other news related to SWIFT, a new capacity it has will look at addressing the lack of visibility in post-trade processing.
Read more: New SWIFT Tool Offers Front Row View of Post-Trade Settlement Journey
PYMNTS wrote that the new tool, called SWIFT Securities View, will also look into helping prevent settlement fails.
It’s attempting to fix the problem with security transactions — as, whenever such a transaction is placed, multiple intermediaries make it impossible to track every step in the processing life cycle. Because of the lessened visibility, there’s more risk of the security ending up in the wrong place. That can make it so the settlement fails and there’s more operational costs and regulatory penalties.
SWIFT Securities View allows a “front-row seat” to see every step in the settlement journey, allowing them to identify trades at risk of failing or see discrepancies between buy-sell instructions.
“SWIFT Securities View does more than just empower our customers to identify and rectify discrepancies in settlement transactions; it sets the blueprint and foundation for a new industry standard to radically transform the industry, just as SWIFT gpi continues to do for cross-border payments,” said Vikesh Patel, head of securities strategy at SWIFT.
New PYMNTS Study: How Consumers Use Digital Banks
A PYMNTS survey of 2,124 US consumers shows that while two-thirds of consumers have used FinTechs for some aspect of banking services, just 9.3% call them their primary bank.
https://www.pymnts.com/blockchain/2022/blockchain-based-smart-contracts-can-cut-escrow-costs-prevent-mortgage-fraud/partial/