16 October 2017

RBC tests distributed ledger for remittances and loyalty programme

26 February 2016  |  14298 views  |  0 RBC brance signage 2

The Royal Bank of Canada (RBC) is the latest financial services giant to go public with its distributed ledger progress, confirming that it is working with Ripple on cross-border payments and experimenting with a blockchain-based loyalty platform.

RBC, which operates in 40 countries, began looking into the how it could use the technology behind bitcoin to make cross-border payments cheaper and more efficient two years ago, Eddy Ortiz, VP of solution acceleration and innovation told Deloitte University Press.

Eventually the bank settled on Ripple, which is already working with a number of Tier 1 banks - including RBS and CBA - and this week boasted that its network and native currency could save banks up to 60% on costs associated with global interbank settlements.

RBC and Ripple are carrying out a limited-production proof of concept to test scalability, reliability, security, and performance, A large-scale deployment could follow and using the technology in other areas is also being investigated, says the Deloitte article.

In addition, RBC is working on how it can use a blockchain to engage customers in real time for a loyalty programme, explaining how points and rewards are accruing as products and services are used. Customers could also use the system to engage with the bank's partners for real-time redemption.

“Our customers will be able to see their points accrue each time they use their RBC credit card. And the reward points become like liquid cash, enabled by blockchain," says Ortiz.

Separately, Japan's Orix, Shizuoka Bank and NTT Data have set up a joint blockchain research project. The partners plan to build a prototype system and use distributed ledger tech to carry out proof-of-concept testing in areas such as overseas remittances and settlement services.

The firms say that they also hope to bring in players from other other industries to investigate the use of blockchains in fields outside of financial services.

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