J.P. Morgan is to widen the use of the industry’s leading blockchain technology to help smooth the banking industry’s payment system while also inviting fintechs to experiment on how to develop the platform. The expansion of the Interbank Information Network (IIN), which enables banks to share information on a mutually accessible ledger, comes after 75 of the world’s biggest banks joined the venture last year.
The platform already allows banks to quickly resolve compliance issues that can delay payments by weeks. They also hope that by making the global payments rails run more easily they will be able to better defend their cross-border-payments business from the rise of digital payments providers such as TransferWise, Revolut and Ripple.
More than 220 banks have now signed up to the original service of allowing data sharing on payments over network so that errors can be resolved quickly. “The initial use case was around sanctions screening. Now we’re looking at the ability to do more at the point of settlement,” said the bank’s head of global clearing, John Hunter.
The IIN is also setting up a sandbox for fintechs to use the network to “develop and put out applications”. The testing environment, which J.P. Morgan expects to launch in the third quarter, will offer developers building blocks such as secure messaging, document file transfer and data modeling.