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Crypto converts JPMorgan, DBS, Temasek pivot to blockchain for interbank remittances

The new system, dubbed Patrior, is designed to replace the inefficient โ€œhub-and-spokeโ€ model for international payments.

Crypto converts JPMorgan, DBS, Temasek pivot to blockchain for interbank remittances
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American investment bank JPMorgan has teamed up with Singaporean DBS Bank and holding company Temasek to develop a blockchain-based interbank remittance system, dubbed Patrior, that aims to soothe some of the most common โ€œpain pointsโ€ in the sector.

โ€œWe believe a shared ledger infrastructure such as the Partior platform will change the way payments are cleared and settled, through this first-of-its-kind, wholesale payments rail based on digitized commercial bank money,โ€ said Takis Georgakopoulos, global head of wholesale payments at JPMorgan, in the announcement.

Per the press release earlier this week, most contemporary cross-border payments systems are based on the so-called โ€œhub-and-spokeโ€ model, a paradigm where routes for distribution of something are designed as a series of โ€œspokesโ€ that connect outlying points to a central โ€œhub.โ€

Amid the emergence of decentralized technologies, such traditional systems are quickly becoming obsolete and result in โ€œcommon pain pointsโ€ such as โ€œmultiple validations on payment details by banks, which translate to costly and onerous post transaction exception handling and reconciliation activities,โ€ the bankers explained.

Out with the old

To address these issues, blockchain-based Patrior aims to improve the efficiency of digital interbank clearing and settlements by enabling โ€œnext-generation, programmable value transfer for participating banks and their clients in real-timeโ€ across an open industry platform.

โ€œThe current hub and spoke arrangement in global payments often results in delays as confirmations from various intermediaries are needed before a settlement is treated as final,โ€ explained Piyush Gupta, CEO of DBS Bank, adding, โ€œBy harnessing the benefits of blockchain and smart contracts technology, the Partior platform will address current points of friction.โ€

He noted that Patrior will support real-time international multi-currency payments and trade finance as well as foreign exchange and securities settlements made using the delivery versus payment method.

โ€œWe are pleased to work alongside DBS and J.P. Morgan to create a global platform that will have tangible impact on global payments. Finding the right approach to payments transformation using new technologies should be a priority as we take our existing infrastructure into the next stage of digitalisation and connectivity,โ€ added Temasek deputy CEO Chia Song Hwee.

As CryptoSlate reported, JPMorgan has recently opened 64 job positions for blockchain engineers skilled in Ethereum, Corda, and Hyperledger development.

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