IBM has a new blockchain for banks to speed up cross-border payments
IBM has worked with a number of international banks including BBVA, Bank Danamon and National Australia Bank
- Its new blockchain will allow all "appropriate" parties access to clearing and settlement data on financial transactions
- The corporate giant partnered with non-profit blockchain organization Stellar and currency exchange service KlickEx to develop the platform
IBM has developed a blockchain platform that allows banks to rapidly clear and settle payment transactions around the world.
Blockchains are groupings of data maintained by a disperse network of computers rather than a centralized mainframe. Data is secured through encrypted 'blocks' and accessed via a peer-to-peer network.
"With the guidance of some of the world's leading financial institutions, IBM is working to explore new ways to make payment networks more efficient and transparent so that banking can happen in real-time, even in the most remote parts of the world," Bridget van Kralingen, senior vice president of IBM Industry Platforms, said in the announcement Monday.
"Making distributed ledger technologies more interoperable is the latest example of IBM's leadership driving the rapid advancement of blockchain."
IBM's blockchain will allow all "appropriate" parties access to clearing and settlement data on financial transactions. It is currently live in 12 "currency corridors" across the Pacific Islands and Australia, New Zealand and the U.K.
Big Blue said it wants to speed up the "costly, laborious and error-prone" process of making global payments in different currencies. It also aims to increase financial inclusion for people with restricted access to the financial services in developing countries.
The corporate giant partnered with non-profit blockchain organization Stellar and currency exchange service KlickEx to develop the distributed ledger.
"Currently, cross-border payments tend to take up to several days to clear," Jed McCaleb, co-founder of Stellar, said in the announcement.
Stellar's McCaleb founded Ripple, owner of the third-largest cryptocurrency by market cap, in 2011, but subsequently left the company.
He said: "This new implementation is poised to start a profound change in the South Pacific nations, and once fully scaled by IBM and its banking partners, it could potentially change the way money is moved around the world, helping to improve existing international transactions and advancing financial inclusion in developing nations."
Stellar is also the issuer of the digital currency Lumens, which is the 13th largest virtual asset by market cap, according to data from CoinMarketCap.