- JPMorgan teams up with six Indian banks to develop a blockchain-based platform.
- The pilot project will be launched using JPMorgan’s Onyx blockchain platform.
- The project will be deployed following approval from the International Financial Services Center Authority.
Banking giant JPMorgan (JPM) has partnered with six Indian banks to launch a blockchain-powered platform that facilitates the settlement of interbank US dollar transactions within India’s latest international financial hub, reported Bloomberg.
About the new partnership, Kaustubh Kulkarni, senior country officer, India and vice chairman, of Asia Pacific at JPMorgan, stated in an interview:
We will be running a pilot project for the next few months as we need to analyze banks’ experience.
According to Kulkarni, the six Indian banks are HDFC Bank, ICICI Bank, Axis Bank, Yes Bank, and IndusInd Bank, alongside JPMorgan’s in-house banking unit located at Gujarat International Finance Tec-City, also known as the GIFT City.
The much-anticipated project by JPMorgan and the Indian banks will be initiated utilizing JPMorgan’s Onyx blockchain platform, launched in 2020 as a blockchain-powered platform designed specifically for wholesale payment transactions.
This development will offer additional momentum to India’s efforts in establishing the Gujarat International Finance Tec-City as a viable alternative trading hub to Singapore and Dubai.
Following the approval from the International Financial Services Center Authority, the pilot project by JPMorgan will be officially launched.
In the existing Indian settlement system, transactions typically require several hours for completion, and users often face limitations in making financial settlements on Saturdays, Sundays, and especially holidays.
In contrast, blockchain technology offers an advantage as it enables real-time and round-the-clock transaction settlements, over the current characteristics of the Indian payment space.
The objective of JPMorgan’s pilot project is to address the challenges by enabling real-time settlement of dollar trades throughout the day and night, instead of the current practice of settling over several days and exclusively during weekdays.
Kulkarni added, “By leveraging blockchain technology to facilitate transactions on a 24×7 basis, processing is instantaneous and enables GIFT City banks to support their own time-zone and operating hours.
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