In November 2022 Standard Chartered invested in Partior, the blockchain-based interbank payment network founded by DBS Bank, JP Morgan and Temasek. Today Standard Chartered announced it is the first settlement bank on the tokenized deposit network to support Euro transfers, with Siemens and iFast Financial participating in transactions earlier this week.
On Monday we reported that all three founding banks are now in production. Several other currencies are planned but the network currently supports US Dollars, Singapore Dollars and Euros. Standard Chartered confirmed it has integrated Partior with its core banking system. The network uses DLT to speed up cross border payments and also provides added transparency for customers.
While Partior doesn’t disrupt the correspondent banking system, it addresses some of Swift’s pain points. Firstly, the banks perform compliance in advance, preventing delays for AML queries. Many conventional payments are held up by the operating hours of the recipient banks or delays in the recipient bank updating the balance in customer accounts. Partior avoids the split between the message and money movement and enables 24/7 interbank transfers. That’s particularly important for corporates.
“Our collaboration with Partior to be the first Euro settlement bank to launch on the network brings us closer to our goal of providing real time, 24/7 flows at scale for corporates and financial institutions while meeting their treasury needs in a safe and efficient manner,” said Mahesh Kini, Global Head of Cash Management at Standard Chartered.
We understand the plan is for other banks to connect to the network via the settlement banks.
Partior as a Unified Ledger
Partior calls itself a Unified Ledger. So how does it differ from Project Agorá, the cross border payment initiative recently launched by the BIS and seven central banks? Agorá also uses tokenization and avoids disrupting the correspondent banking system. However, the presence of the central banks is the big differentiator.
Partior enables 24/7 interbank transfers for smaller banks and corporate clients. However, the settlement banks still need to settle amongst themselves. This is currently done conventionally via Swift. In contrast, Project Agorá will use tokenized central bank money (like wholesale CBDC) for the interbank settlement.
DLT for corporate treasurers
Siemens is no stranger to blockchain solutions. It issued a €60 million digital bond on a public blockchain and was amongst the first clients to use JP Morgan’s JPM Coin blockchain-based bank account and its programmable payment functionality. JPM Coin allows the company to move money between subsidiaries in different jurisdictions 24/7. However, it is restricted to dollars and euros and accounts at the one bank.
“Leveraging the groundbreaking Partior platform, we’re not just streamlining cross-bank payments but also covering our geographical footprint for such transactions,” said Heiko Nix, Global Head of Cash Management and Payments, Siemens AG. “The bank’s integration of Euro-denominated settlements between Hong Kong and Singapore, via Partior, is not just a testament to its technological advancement but a beacon for the future of seamless, secure, and efficient global payment systems.”
This week, we reported that Partior has a new CEO, Humphrey Valenbreder, after the founding CEO’s departure four or five months ago.
