The Monetary Authority of Singapore has announced the successful conclusion of a proof-of-concept project to conduct domestic inter-bank payments using distributed ledger technology (DLT)
The project, in partnership with R3 and a consortium of leading financial institutions, was first announced on 16 November 2016 by MAS.
In a statement, the regulatory body says: "The project has achieved the objectives of producing a digital representation of the Singapore dollar for interbank settlement, testing methods of connecting bank systems to a DLT, and making the MAS Electronic Payment System (MEPS+) interoperate with the DLT for automated collateral management."
The consortium has commissioned Deloitte to produce a report on the outcomes and design principles for a working system.
Sopnendu Mohanty, chief fintech officer, MAS, says: “This wholesale payments project has demonstrated the commitment of MAS and the industry to co-create concrete use-cases for technologies such as DLT. Already, some institutions have embarked on projects that are inspired by this collaboration. We look forward to the next phases of our project which will develop trial applications for securities settlement and cross border payments.”
The first of these spin-offs, driven by the Singapore Exchange (SGX), focuses on making the fixed income securities trading and settlement cycle more efficient through DLT. The latter will explore new methods to conduct cross border payments using central bank digital currency.
Mohany says MAS is in the early stages of discussions to develop links from Singapore to other countries using DLT to allow cross-border payments to settle directly using central bank accounts.