HSBC Settles on DLT for FX Payments

HSBC has settled more than three million foreign exchange (FX) transactions and made more than 150,000 payments worth US$250bn using distributed ledger technology (DLT). The solution, called HSBC FX Everywhere, has been used for the past year to orchestrate payments across HSBC’s internal balance sheets, creating significant efficiencies and opportunities.

Using a shared permissioned ledger, which provides singularity, transparency and immutability, it transforms the process around intra-company foreign exchange activity, automating several manual procedures and reducing reliance on external settlement networks.

The bank says that key benefits include:

• Singularity, transparency and immutability. A shared, single version of the truth of intra-company trades, from execution through to settlement, which reduces risk of discrepancy and delay.
• Payments orchestration. Confirmation and settlement is automated by matching and netting transactions, which reduces costs and reliance on external settlement networks.
• Balance sheet optimisation. A consolidated, global view of forward cash flows, and certainty of funds throughout the funding cycle, supports greater balance sheet optimisation.