Accenture, a leading management consulting and professional services company, has prepared a report on the satisfactory results of Phase 2 of Project Ubin – a pilot conducted by the Monetary Authority of Singapore (MAS) and The Association of Banks in Singapore (ABS). The project is focused on blockchain technology and aims to show how it can help the payment systems.
“We are excited about what can be achieved in the upcoming phases and the opportunity to demonstrate blockchain’s potential to support additional types of financial transactions and cross-border connectivity,” says the report.
We reported that Project Ubin, which started in 2016, is based on Ethereum network and is divided into five phases.
At this stage, there was created a prototype based on three blockchain platforms that were tested by 11 major banks. The banking consortium includes Bank of America Merrill Lynch, Citi Bank, Credit Suisse, JP Morgan, DBS Bank Ltd, Mitsubishi UFJ Financial Group, HSBC Limited, OCBC Bank, Singapore Exchange, Standard Chartered Bank, and United Overseas Bank. The pilot shows that real-time gross settlement (RTGS) functionalities, particularly Liquidity-Saving Mechanisms (LSM) and gridlock resolution, can work well on a blockchain system. Most importantly, the experiment showed that RTGS does well while keeping the privacy of banking transactions.
Project Ubin’s Phase 2 Co-Chairs are Sopnendu Mohanty, Chief FinTech Officer at the Monetary Authority of Singapore, and Mrs. Ong-Ang Ai Boon, Director of The Association of Banks in Singapore.
Mentioning other benefits of blockchain technology, the report notes:
“Decentralizing the key functions of a RTGS system may not only mitigate the inherent risks of a centralised system, such as single point of failure, but may also affirm the promised benefits of DLT, for example cryptographic security and immutability.”
Accenture created three blockchain prototypes through its Singapore branch Accenture Liquid Studio. The systems were built based on different platforms: R3’s Corda, Hyperledger Fabric, and Quorum. All three prototypes showed satisfactory results.
Divyesh Vithlani, Managing Director Financial Services Accenture, commented: “Ubin Phase 2 not only successfully proves that RTGS functions can be decentralized without compromising privacy, but also marks a major industry-wide collaborative success in Singapore, laying the foundation for future industry innovations.”
David Treat, Managing Director of Accenture’s global blockchain practice, said:
“This innovative collaboration with MAS and ABS demonstrates the value that blockchain can unlock in the settlement of payments. We are excited about what can be achieved in the upcoming phases and the opportunity to demonstrate blockchain’s potential to support additional types of financial transactions and cross-border connectivity.”
The report was presented at the opening of Singapore Fintech Festival, which starts November 14, by the MAS Managing Director, Ravi Menon.
At the event, the MAS also unveiled plans on working with the Bank of Canada to test blockchain for cross-border payments.
Currently, the MAS and the Bank of Thailand have agreed to collaborate by linking PayNow and Thailand's PromptPay, which are P2P payments transfer systems.
Earlier, we reported that MAS announced a collaboration with Hong Kong’s Monetary Authority to support fintech development.