JP Morgan and Baton Systems develop real-time clearing system
JP Morgan has partnered with distributed ledger technology firm Baton Systems to develop a new real-time cash orchestration and collateral transfer system.
According to the firms, the new system will address the challenge of having to tie-up excess funds across the clearing workflow by integrating settlement instructions for custodians and other funding sources into existing treasury platforms.
The resulting end-to-end automation of workflows provides “full visibility” of the asset flows between JP Morgan and clearing houses, with “complete audit trails and real-time notifications”.
“The technology we have developed reduces the time needed to process the entire collateral workflow from hours to near real-time,” says Anthony Fraser, head of global clearing operations and trading cost management at JP Morgan.
He adds that the bank is already seeing “faster, more efficient payments, reconciliation and reporting for all parties in the collateral lifecycle”.
CEO and founder of Baton Systems, Arjun Jayaram, describes the platform as “truly ground-breaking” which will remove the need for manual intervention in the collateral process.
Founded in 2016, Baton Systems recently secured $12 million in a Series A funding round led by Trinity Ventures. The firm has raised $15.1 million to date.