Bahrain’s Bank ABC taps JP Morgan for blockchain-based cross-border payment service
Bahrain-based Bank ABC is launching a new blockchain-based cross-border payment service for its corporate and institutional clients in collaboration with JP Morgan and the Central Bank of Bahrain (CBB).
The soft-launched service seeks to enable the bank’s clients to complete high-value transfers between Bahrain and the US through JP Morgan’s Coin Systems, which sits upon the JP Morgan Onyx blockchain system which was launched in 2020.
Coin Systems supports the US bank’s product solution, JPM Coin, which through a permissioned set-up, enables cross-border transfers through its payment rail and deposit account ledger. In this, it seeks to overcome the traditional hurdles of international payments, namely liquidity funding, and can support various payment types including Delivery versus Payment (DvP), Payment versus Payment (PvP) and machine-to-machine payments.
Sael Al Waary, group CEO of Bank ABC, explains how the service seeks to “reduce traditional settlement periods considerably” in addition to offering “more cost-effective” international transfer options for participating clients.
Further developing the reach of its new service, Bank ABC also worked in “close collaboration” with CBB, a two-year relationship which predominantly oversaw the integration of bank’s solution with the Kingdom’s national payments infrastructure.
Rasheed AlMaraj, governor of the CBB, says the service aligns with the central bank’s “vision to embrace innovation and digitise the Kingdom’s financial service sector” through the elimination of traditional cross-border payment inefficiencies and facilitating trade between Bahrain and the US, thereby stimulating economic activity.
Bank ABC appears to be doubling down on its trade finance systems as of late, as the launch of its blockchain-based cross-border payment system arrives almost in tandem with ABC Trade, a cloud-based digital platform that the bank launched last week in collaboration with the Swiss technology provider, Komgo, as a means to connect its corporate clients with a documentary trade suite.