Partior, a blockchain technology provider for payments clearing and settlement, became operational on Oct 26 and has begun its first pilot with participating banks, achieving end-to-end settlements in SGD and USD of less than 120 seconds. With global cross-border transactions expected to reach US$156 trillion in 20222 , Partior is well placed to solve existing pain points such as slow settlement speeds and costly transaction fees. The exponential leap forward in reducing settlement time is creating significant interest across the payments ecosystem.
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Partior was founded by DBS, J.P. Morgan and Temasek, and has its genesis in Project Ubin - a collaboration between the Monetary Authority of Singapore (MAS) and the financial industry to explore the use of blockchain and distributed ledger technology for clearing and settlement services.
The new platform uses an ‘atomic’ model to replace the existing sequential operational approach to payments settlement. Simultaneous settlement, combined with a 24x7, always-on infrastructure may help speed up wholesale settlements by banks from an average of two days to 120 seconds when the banks on the payment chain are using Partior. In turn, the reduction in settlement time may free up liquidity and reduce settlement risk.
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Use of the Partior platform also increases visibility of payment flows for participating banks by potentially reducing the need for intermediaries. Reducing intermediaries involved in payment processing for settlement helps solve another significant issue in the form of the existing ecosystem - cost - by decreasing the number of parties that deduct fees from the payment.
