SWIFT Partners With Major Banks To Test Blockchain Voting

| Publish date: 03/07/2019
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SWIFT, which is known as a financial messaging giant, has reportedly partnered with SGX and at least four major banks. There is a reason why these organizations decided to team up, and it is to basically trial a platform specifically designed for e-voting. Interestingly, it is based on the blockchain tech.

Introducing Distributed Ledger Technology

According to the official announcement made by the company, the joint effort is meant to determine whether distributed ledger technology (DLT) has the ability to support shareholder voting. And if it does, the partnership intends to prove that creating such a system could simplify and make the voting more efficient.

As for the banks joining the collective effort, they are none other than HSBC, DBS, Chartered Bank, and Deutsche Bank. Apparently, the financial messaging firm confirmed that SLIP, which is a securities software provider, is also part of the partnership.

It holds true that shareholder voting plays a crucial role in many areas of finance. However, it has been proven time and again that it is cumbersome, not to mention being resource intensive and time-consuming. At the end of the day, the overall process could be a daunting task to perform, especially since it remains to be a paper-based process.

Benefits Of Using DLT

SWIFT noted that DLT, in particular, has the potential to resolve these issues and provide a much better path towards revolutionizing the shareholder voting process. According to the company, proxy voting is often expected to result in a complex manual process, one that is packed with tons of errors. The industry, as per the words of the firm, can gain the ability to avoid these mistakes by simply fostering the idea of automation and transparency.

The proof-of-concept (PoC) is scheduled for testing a DLT voting solution, which would reportedly involve a number of issuers. Also, it is expected to include a securities depository (CSD) alongside data managed completely over a blockchain system that is permissioned and private.

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The partners, as per the official report, are going to examine any viability concerning these hybrid solutions from SWIFT. This is most especially the case since they are said to be able to merge the financial messaging standard ISO 20022 and the DLT. And through this combination, the financial messaging firm is confident that it could significantly boost interoperability and, more importantly, prevent market fragmentation from happening.

All the banks mentioned except for DBS are going to act as participants for the trial. DBS and SGX, on the other hand, will be both participants and issuers.

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