IBM leveraging Blockchain technology to simplify cross-border payments

IBM, the global technology giant, has teamed up with blockchain startup Stellar and payment company Kickex to launch a cross-border payment system for banks which uses the blockchain to reduce the settlement time and lower the cost of completing global payments for businesses and consumers. Though the blockchain technology has long been a method to quicken and cheapen cross-border payments by startups making moves privately, IBM is the first high profile company to announce its own solution.

IBM commented that “The blockchain would be used to record the terms of the contract, manage trade documentation, allow the farmer to put up collateral, obtain letters of credit, and finalize transaction terms with immediate payment, conducting global trade with transparency and relative ease”. International transactions take days, if not weeks, to be completed. Frustration with that has seen services like TransferWise rise, but, great as they are, they remain solutions for savvy consumers or small businesses rather than all. A blockchain solution for banks addresses the root cause, and it could minimize the potential for errors thanks to the ledger-based system while also providing transparency and flexibility to banks. Bridget van Kralingen, Senior Vice President of IBM Industry Platforms, also added that “With the guidance of some of the world’s leading financial institutions, IBM is working to explore new ways to make payment networks more efficient and transparent so that banking can happen in real-time, even in the most remote parts of the world”.