Swift has announced the results of a global trial to integrate gpi instant, the co-operative’s cross-border instant payments service, into Singapore’s domestic instant payment service, Fast And Secure Transfers (Fast).
Launched in 2017, Swift’s global payments innovation (gpi) has increased the speed, transparency and tracking of cross-border payments through the Swift network. On average, 40% of gpi payments are credited to end beneficiaries within five minutes. However, delays come about when the final leg of the transaction needs to be cleared within the recipient country, due in part to local clearing systems’ limited operating hours.
Connecting gpi to regional and domestic instant settlement systems is Swift’s way of getting around this. By reusing existing cross-border and domestic payments infrastructure, the company hopes to minimise implementation costs and avoid the complexities of adopting new cross-border infrastructure.
This latest trial comes after a successful trial in Australia last year, which saw gpi combined with that country’s national payments platform (NPP). It demonstrated that by enabling gpi in real-time domestic systems, cross-border payments can be effected almost instantly, even when they involve domestic settlement and non-gpi banks. The results of the test provided the impetus for discussions between Swift and regulators around the world to connect even more payment corridors to the gpi system.
The Singapore-focused trial involved 17 banks across seven countries – Australia, China, Canada, Luxembourg, the Netherlands, Singapore and Thailand, with 11 banks initiating cross-border payments into Singapore, and six banks in Singapore processing the payments domestically via the Fast system. According to Swift, the trial saw payments between all continents settle within 25 seconds; the fastest in just 13 seconds. The fastest payment into Asia Pacific from Europe took 15 seconds, and from North America 20 seconds.
“Across the world, through gpi, banks and instant payment systems are using our existing rails for international payments to meet today’s need for speed, traceability and transparency. Swift envisages that cross-border payments will become as convenient as domestic transactions, and the successful testing across multiple corridors between Europe and North America to Asia Pacific confirms the important role that gpi instant will play in making that bold vision a reality,” says Harry Newman, head of banking at Swift.
Additional tests are planned in other markets with instant payment systems, ahead of the scheduled global launch of gpi instant later this year. Results from an upcoming test with banks and the Eurosystem’s Target instant payment settlement system (Tips) in Europe will be presented at Sibos, which will be held in London in the third week of September.
Together, Swift says the Tips, Fast and NPP instant payment systems are the first of many domestic real-time infrastructures, connected via the banks and using gpi, that will enable a globally-scalable instant cross-border payments service.