Accenture and SAP Build Prototype that Uses Distributed Ledger Technology to Enable More Efficient, Secure and Reliable Payments Between Banks and Customers
Companies Collaborate with R3’s Corda Platform for Real-Time Gross Settlement System
With real-time gross settlement (RTGS) systems, electronic funds transfers between banks occur in real time and settle on a one-to-one basis. This process is often used for high-value transactions that require immediate clearing and are typically handled by central banks.
The payment platform plans to allow for integration and interoperability between distributed ledger technology (DLT) -based and classic government-issued payments and settlements. The co-innovated prototype design uses currency tokens to facilitate end-to-end settlement . Currency tokens are used in preference to digital currencies in this design because they serve as a proxy for standard central bank fiat currency and use cryptography to increase security and authenticity. The prototype provides the flexibility that is essential to adopting and integrating new payment technologies while allowing banks to maintain their current payment formats.
The prototype uses the SAP Payment Engine application, which serves as the central hub for payment initiation, processing, clearing and settlement and integrates with R3’s Corda platform to enable interactions with RTGS systems, delivering nearly seamless interoperability between conventional and token-based payments. Leveraging Accenture’s experience in central bank clearing and settlement, and blockchain capabilities, the prototype will enable peer-to-peer payments between banks that have adopted DLT as well as those that have not.
“As market participants accelerate their use and acceptance of digital payments, payment providers and banks need to adapt quickly and prepare for these new forms of payments,” said Falk Rieker, global head of IBU Banking at SAP. “The RTGS platform is designed to enable banks and payment providers to easily adopt and integrate DLT-based payments on their existing platforms, helping banks to safeguard as well as augment the value of their investments.”
“As digital currencies gather momentum, the need for interoperability between conventional and token-based systems is key in meeting the promises of tokenization,” said Cathy Minter, chief revenue officer at R3. “Corda was designed to execute transactions seamlessly from the outset, with the highest levels of certainty and security. Through our relationship with Accenture and SAP, R3 is collaborating with two of the tech industry’s major players to provide a real-time gross settlement token-based exchange. The end result is nearly instantaneous settlements, which will reduce friction throughout the transaction chain.”