8 March 2018

SWIFT completes landmark DLT proof of concept

Proof of concept is one of the most extensive Hyperledger Fabric 1.0 implementations executed in the industry to date

SWIFT completes blockchain proof of concept (PoC) to address Nostro account reconciliation issues.

Distributed ledger technology proof of conceptdlt_poc_256_mo.mp4

According to a recently published report by SWIFT, the PoC showed that DLT could deliver the business functionalities and data richness required to support automated real-time liquidity monitoring and reconciliation. It enabled:

  • Real-time event handling
  • Transaction status updates
  • Full audit trails
  • Visibility of expected and available balances
  • Real-time simplified account entries confirmation
  • Identification of pending entries and potential related issues
  • Generation of data required to support regulatory reporting

The PoC went extremely well, proving the fantastic progress that has been made with DLT and the Hyperledger Fabric 1.0 in particular.

Damien Vanderveken, Head of Research and Development, SWIFT

While successfully meeting all the business requirements that had been set out, the PoC evidenced the considerable pre-requisites for such a solution to be adopted by the industry – for instance, all account servicers would first need to migrate from batch to real-time liquidity reporting and processing, and bank office applications would need to be upgraded to feed the platform with real-time updates.

SWIFT DLT PoCDownload the infographic

“Although the PoC demonstrated DLT could improve Nostro liquidity management and reconciliation processes, it also revealed that the pre-requisites will have to be met before banks can enjoy the full benefits of switching to a DLT process”, added Vanderveken.

On a positive note, according to the report, SWIFT can help facilitate the necessary improvements in the Nostro process by helping its community migrate towards real-time liquidity reporting and processing through SWIFT gpi.  Also, the report notes that unique identification of each entry is the cornerstone of any liquidity and reconciliation solution. The re-use of the gpi unique end-to-end transaction reference, leveraging SWIFT’s central payments tracker for this purpose is an obvious choice.

According to Vanderveken, The PoC also showed that further progress is needed on the DLT technology itself before it will be ready to support production grade applications in large-scale, mission-critical global infrastructures. For example, while 528 channels were required in the PoC to ensure Nostro accounts would only be stored on the nodes of their account servicers and owners, to productise the solution, more than 100,000 channels would need to be established and maintained, covering all existing Nostro relationships, presenting significant operational challenges.  

Commenting on the emergent technology, SWIFT’s Chief Platform Officer, Stephen Gilderdale added “It is a strategic priority for SWIFT to work with new technologies like DLT and incorporate them into key solutions like gpi. We are already working on new PoCs and will continue our R&D efforts to ensure that SWIFT customers will be able to leverage their existing SWIFT infrastructure and connectivity to benefit from blockchain services, whether offered by SWIFT or by third parties, on a secure and trusted platform.”

It is a strategic priority for SWIFT to work with new technologies like DLT and incorporate them into key solutions like gpi.

Stephen Gilderdale, Chief Platform Officer, SWIFT

With 34 participating banks each with their own node deployed in the SWIFT DLT sandbox, the initiative was one of the most extensive blockchain PoCs and Hyperledger Fabric 1.0 implementations executed in the industry so far, both in terms of participant engagement and in terms of the scale of the infrastructure deployed.

Click here to read the announcement and download a full copy of the report.

gpi real-time Nostro Proof of Concept

Download (578.67 KB)
Last update: 
8 March 2018

Can blockchain pave the way for real-time Nostro reconciliation and liquidity optimisation?

  • Reports
  • Report



gpi real-time Nostro Proof of Concept

Can blockchain pave the way for real-time Nostro reconciliation and liquidity optimisation?

Download (578.67 KB)

Distributed Ledger Technology (DLT)

Understanding the potential to transform the financial industry


SWIFT global payments innovation (gpi)

Global banks are working together to make a dramatic change in cross-border payments.

Extended reading


Safeguarding efficiencies of new technologies: Why common standards matter

How ISO 20022 can better enable DLT and API technologies of tomorrow

SWIFT tests show blockchain has potential for global liquidity optimisation

New paper highlights initial findings from proof of concept to improve real-time Nostro reconciliation, part of SWIFT’s gpi initiative

22 additional global banks join the SWIFT gpi blockchain proof of concept

With its global reach, SWIFT gpi is regarded by banks as the natural place to collaborate and innovate cross-border payments

SWIFT Insights

  • Discover the latest trends in financial services
  • Keep up with our news updates
  • Read thought-provoking industry reports
  • Explore global events and webinars
Read more