Asian bank DBS, J.P. Morgan and Singapore-headquartered investment firm Temasek announced plans to develop an open industry platform to reimagine and accelerate value movements for payments, trade and foreign exchange settlement in a new digital era, through a newly-established technology company.
The company, Partior, which means “to distribute and share” in Latin, aims to disrupt the traditional cross-border payments “hub and spoke” model, that has resulted in common pain points, including multiple validations on payment details by banks, which translate to costly and onerous post transaction exception handling and reconciliation activities.
Partior recognizes the need for more efficient digital clearing and settlement solutions across the banking industry, and targets to address these challenges through the use of blockchain solutions to enable next generation, programmable value transfer for participating banks and their clients in real-time across a common and open platform.
The Partior platform has also set its sights on developing wholesale payments rails based on digitised commercial bank money to enable “atomic” or instantaneous settlement of payments for various types of financial transactions. Such functionality would help banks overcome challenges presented by the current standard sequential method of processing global payments.
Piyush Gupta, CEO of DBS Bank, said in a statement: “The open platform will enable banks around the world to provide real-time cross-border multi-currency payments, trade finance, foreign exchange and DVP securities settlements on a world-class platform, with programmability, immutability, traceability built into its suite of services.”
Takis Georgakopoulos, global Head of Wholesale Payments at J.P. Morgan, said in a statement: “Our newly formed business unit, Onyx by J.P. Morgan, is focused on providing clients with the best-in-class platforms as their business models and banking needs evolve over time. We 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. After five years of being a partner in Project Ubin, we are thrilled by the launch of Partior as it marks yet another milestone for J.P. Morgan and the industry – blockchain-based wholesale payments infrastructure where information and value can change hands around the world in a 24/7, frictionless way.”
Chia Song Hwee, deputy CEO at Temasek, said in a statement: “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 digitalization and connectivity,” adding that there’s interest from other banks and partners.
These efforts by DBS, J.P. Morgan and Temasek build on their past work as part of Project Ubin, an industry initiative by the Monetary Authority of Singapore to explore the application of blockchain technology involving multi-currency payments and settlements.
Sopnendu Mohanty, chief fintech officer at the Monetary Authority of Singapore, said in a statement: “The launch of Partior is a global watershed moment for digital currencies, marking a move from pilots and experimentations towards commercialization and live adoption. With its genesis from Project Ubin, a public-private partnership on blockchain and CBDC experimentation, Partior is a pioneering step towards providing foundational global infrastructure for transacting with digital currencies in a trusted environment, spurring a wide range of use-cases in the blockchain ecosystem.”
The platform will start with a focus on facilitating flows primarily between Singapore-based banks in both USD and SGD, with the intent to expand service offerings to other markets and in various currencies. Partior’s platform will also be designed to complement ongoing Central Bank Digital Currencies (CBDCs) initiatives and use cases.