Singapore has developed a blockchain-based payments network that enables payments to be carried out in different currencies on the same network, the Monetary Authority of Singapore (MAS) and investment company Temasek said yesterday.
The network prototype - which is on track for commercial adoption - can serve as a test network to facilitate collaboration with other central banks and the financial industry for developing next-generation cross-border payments infrastructure, the authority said.
The network was developed by MAS, in collaboration with JPMorgan and Temasek.
A report on the final phase of Project Ubin, a collaborative project between Singapore's central bank and the financial industry to test the use of blockchain and distributed ledger technology for clearing and settlement of payments and securities, was published yesterday.
The report examined the use of blockchain technology in commercial applications across different industries, and how these applications could benefit from integrating with the blockchain-based payments network prototype.
The commercial applications of the payments network prototype include cross-border payments in multiple currencies, foreign currency exchange, settlement of foreign currency-denominated securities, as well as integration with other blockchain-based platforms to enable end-to-end digitalisation across many industries and use cases.
Technical specifications for the functionalities and connectivity interfaces of the prototype network have been made publicly available to spur further industry development.
The benefits of blockchain technology in commercial applications across different industries were validated through workshops conducted with more than 40 firms engaged in phase five, or the final phase, of Project Ubin.
Among the use cases examined and detailed in the report are those in capital markets, trade and supply chain finance, insurance, as well as other areas of services such as media and advertising and salary payments.
For example, for health insurance claims, the payments network could help support automated release of payment upon completion of healthcare services provided by the hospital.
Other possible benefits to be explored include real-time tracking of amounts owed by the patient for subsequent medical treatments, which could help patients make better-informed healthcare decisions.
MAS chief fintech officer Sopnendu Mohanty said the project has built a strong foundation of knowledge, expertise and experience and paved the way towards commercial adoption.
"Following the successful experimentation over five phases, we look forward to greater adoption and live deployment of blockchain technology," he said.
Temasek deputy chief executive Chia Song Hwee said the final phase of Project Ubin has demonstrated the commercial applicability, viability and benefits of blockchain technology across industries, beyond capital markets and trade finance.