SWIFT Deploys Blockchain Based Shared Ledger for 17 Banks
The pilot puts Swift and major banks on a path toward always-on cross-border payments using tokenized deposits inside regulated finance.
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[Source photo: Venkat Reddy Marri/MITSMR Middle East]
Swift has moved its blockchain-based shared ledger from concept to initial use, with 17 global banks preparing to pilot live transactions using tokenized deposits for 24/7 cross-border payments.
The Brussels-based financial messaging cooperative said the participating banks include ANZ, BNP Paribas, BNY, Citi, DBS, First Abu Dhabi Bank, FirstRand Bank, HSBC, Itaú Unibanco, Lloyds Bank, Mashreq, MUFG Bank, OCBC, Standard Chartered, UBS, UOB and Wells Fargo.
The ledger is designed to act as a secure orchestration layer for bank-issued tokenized deposits held on participating banks’ own ledgers. It would allow banks to move customer funds overnight and on weekends before final settlement takes place through existing systems.
Tokenized deposits are digital tokens issued by regulated commercial banks. Each token represents a claim on money held at that bank. Unlike many stablecoins, which are issued outside the traditional commercial bank deposit model, tokenized deposits are meant to keep digital money inside regulated banking infrastructure.
Swift said the project moved from design to operational readiness in nine months. The initial use case is focused on improving cross-border payments, liquidity efficiency and interoperability between tokenized deposits issued by different banks.
The system is not meant to replace existing payment rails. Instead, Swift is trying to add a blockchain-based layer to its global network while preserving compliance, credit, risk and operational controls used in regulated finance.
Thierry Chilosi, Chief Business Officer at Swift, said the new ledger extends “the trust and stability of established finance into the frontiers of digital money.”
“It allows tokenized value to move across borders with the velocity and flexibility modern commerce expects, while maintaining the same high levels of resiliency, security, and compliance global finance requires,” he said.
Swift said 75% of payments on its network already reach beneficiary banks within 10 minutes, often within seconds. The ledger is part of its push to help the industry meet G20 targets for faster, cheaper and more transparent cross-border payments.
For banks, the attraction is the possibility of always-on cross-border settlement without abandoning familiar controls. For corporate clients, the potential benefits include faster payment execution, better liquidity visibility and fewer cut-off constraints across time zones.
Manish Kohli, Head of Global Payments Solutions at HSBC, said the initiative was a step toward making cross-border payments work “in real time, across time zones, and without artificial cut-offs.”
Debopama Sen, Head of Payments at Citi Services, said the ledger could help create interoperable payment solutions with greater speed, resilience and security.
No Indian bank is part of the first group of 17 participants. Even so, the development is relevant for India, where banks and the Reserve Bank of India (RBI) have been experimenting with digital assets, tokenization and central bank digital currency pilots.
The RBI is testing the digital rupee in both retail and wholesale segments. It has also explored wholesale CBDC use cases and tokenization in financial markets. Indian banks are major users of Swift for international payments, remittances and trade finance, making any change to cross-border payment infrastructure significant for the country’s financial system.
Swift said the ledger could later support programmable payments, digital trade and agent-driven commerce. Those use cases remain at an early stage, but the pilot shows how regulated banks are trying to respond to pressure from stablecoins, blockchain networks and new forms of digital money.
The broader question is whether banks can make cross-border payments faster and more flexible without losing the compliance and settlement safeguards that underpin the current system. Swift’s ledger is an attempt to do both.
