To support its worldwide accounts, Lloyds Bank has merged with 27 other banks to use a technology project known as nostro accounts, which uses blockchain, according to Computer Weekly.
Society for Worldwide Interbank Financial Telecommunication (Swift) organised the project that enables banks managing nostro accounts, which makes cross-border payments.
‘Little intraday reporting coverage’
According to Swift, banks can’t currently monitor their accounts in real time because of little intraday reporting coverage.
Head of Research and Development at Swift Lab, Damien Vanderveken, said: “If banks could manage their nostro account liquidity in real time, it would allow them to accurately gauge how much money is required in each account at any given point, ultimately enabling them to free up significant funds for other investments.”
‘Collaboration between banks is vital’
“Working independently of the founding banks, the 22 institutions will act as a validation group to further test the application and evaluate how the technology scales and performs,” added Swift.
The project involved Australia and New Zealand Banking Group, BNP Paribas, BNY Mellon, DBS Bank, RBC Royal Bank and Wells Fargo.
Written by Leah Alger