Currently, most cross border payments go through Swift, but Visa is hoping to break into the market which it says is worth $125trn.
Speaking about the development, Kevin Phalen, Visa's global head of business solutions said, "Its newly launched distributed ledger software facilitates direct bank connections".
Visa B2B Connect helps eliminate friction and time spent on cross-border corporate transactions by facilitating transactions from the bank of origin directly to the beneficiary bank. This takes some of the features of the blockchain containing elements of Hyperledger, the open source distributed ledger technology (DLT) developed by a group led by the Linux Foundation, the report notes. It comes as the latest blockchain play from Visa, after the firm recently announced it had partnered with messaging app LINE to explore new blockchain digital payment technologies. This system has been recognized as flawed and inefficient, but the stubborn nature of bankers and governments meant that nothing would be done as long as the banks profit and help the economy grow. Besides this, it's complicated to monitor the transfer's status and anticipate the cost associated with it, including the Forex rate that comes with it.
The B2B Connect can allow banks to directly connect with each other, and customers can see the payment fees upfront. Having participated in the pilot program, Commerce Bank is excited to see how this innovative solution will change the way cross-border payments are made, while increasing the speed and transparency for businesses around the world. Velocity, security and control of transactions, as well as lower counterparty risks are essential for a successful business with global partners.
The new network is a result of collaboration with tech global giant IBM, as well as e-payment operator Bottomline Technologies and fintech firm FIS. Bottomline and FIS in particular are said to be bringing the platform to its participating bank clients.
Visa Inc. (NYSE: V) is the world's leader in digital payments. Visa says Bottomline and FIS are now working with their respective bank clients to integrate Visa B2B Connect.
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