EBA Clearing, SWIFT and The Clearing House join hands to make cross-border payments faster
In a bid to benefit the businesses and consumers in two of the largest economies, three payments infrastructure players are coming together to bring real-time cross-border payments across two continents which are built on benefits from domestic real-time payments.
In a recent announcement, EBA Clearing, SWIFT and The Clearing House made an announcement that they along with the banks from Europe and North America have joined hands to make ‘cross-border payments as seamless as the fastest domestic payment options’ under the new initiative of Immediate Cross-Border Payments (IXB).
According to the press statement, Immediate Cross-Border Payments (IXB) with the support of 11 banks helped with the design, with seven banks namely Bank of America, BBVA Group, Citi, HSBC, Intesa Sanpaolo Bank, J.P. Morgan and PNC Bank – participating in the proof of concept wherein the banks did exchange payment and confirmation of receipt messages.
IXB under the proof of concept also demonstrated the ability to synchronize settlement in one instant payment system with settlement in the other and convert real-time messages between both systems, and also noted that it could be expanded to additional currencies and ‘is also replicable for more liquidity-efficient high-value payments’.
“By leveraging the RTP network in the United States and RT1 in Europe, along with ISO 200022 message formats, IXB demonstrates that a faster cross-border payments capability is possible and can be delivered using existing technology,” said Russ Waterhouse, Executive Vice President for Product Development and Strategy at The Clearing House.
Adding further, Waterhouse added, “By utilizing existing faster payments systems, financial institutions can leverage existing processes, protocols and technology to make the user experience seamless across payment types, whether domestic or cross border.”
In the statement, it was noted that the initiative responds towards the growing expectations of the consumers and businesses who have ‘experienced the benefits of domestic real-time payments and now have similar expectations for cross-border transactions’.
“IXB demonstrates how the current ecosystem of cross-border payments may be enhanced and made suitable for new high-volume 24/7 business,” said Erwin Kulk, Head of Service Development and Management at EBA Clearing.
EBA Clearing is a pan-European payments system that connects to over 4800 financial institutions across Europe and operates and manages EURO1, STEP1, STEP2 and RT1. Both EURO1 and STEP2. The Clearing House is an operator of the Real-Time Payments Network in the United States and CHIPS which is a USD clearing system.
The banks engaged in the IXB initiative are Bank of America, BBVA Group, Citi, Credit Agricole, Deutsche Bank, HSFC, ING, Intesa Sanpaolo Bank, J.P. Morgan, PNC Bank, and Societe Generale.
“Linking market infrastructures and financial institutions is a fundamental pillar of our strategy to enable instant and frictionless transactions around the world, and one of the key building blocks in the CPMI’s global roadmap on enhancing cross-border payments,” said David Watson, Chief Strategy Officer for SWIFT.
It was noted in the press note that by taking advantage of existing infrastructure, technology and standards, IXB can meet the expectations across the globe for a simple and more transparent way to send cross-border payments. Also, IXB uses ISO 20022 message standards.