The SWIFT network continues to be the best system available for cross-border payments. However, its ascendancy has been threatened in recent times by the development of cryptocurrencies but SWIFT is fighting back. The latest move by the network to stay relevant is to launch a new service that will allow for real-time international payments. This is being done by integrating gpi and domestic payment networks into a single service.
One of the main features that cryptocurrencies always tout is that they can transfer money internationally faster than normal banks. With this new integrated service, SWIFT will be able to make the same instant international payments that cryptocurrencies boast about. Senders will have to pay an additional fee but they will now be able to send their money instantly all over the world.
This is a major move since it will extend the existing gpi network into domestic markets. This will allow banks to deliver a better service with their current investment. Thanks to the approach of using the current gpi network and the domestic real-time payment networks, there are no additional implementation costs or the need to shift to a new network structure. This saves banks a lot of money in the long run and allows them to start offering this service in no time.
According to SWIFT, this service will be available to all customers ranging from a small business to a major multi-national company who will be able to access this new service that provides for speedy global payments.
SWIFT has demonstrated to the market how effective this new service is as several national networks have used the new service with success. Trials with the New Payments Platform (NPP) in Australia show that it only takes 18 seconds to deliver payments between Australia and China.
Singapore’s Fast And Secure Transfers (FAST) trials saw the fastest payments and the most comprehensive tests. With seventeen banks in 7 countries being tested, 13 seconds was clocked as the fastest time while continental payments required 25 seconds. The slowest recorded trial was at 41 seconds which is still under a minute.
Harry Newman, Head of Banking at SWIFT said that SWIFT will be discussing with various banks on how they can implement the new service into a live operation. With the technology in place, near-instant cross-border payments via banks will soon be a reality.