UNIONBANK of the Philippines is now part of an international bank network that uses the blockchain technology to minimize friction in global payments process.
In a statement sent to reporters, J.P. Morgan said it has expanded its Interbank Information Network (IIN) to bring its total members to 76 lenders, which include the Aboitiz-led UnionBank as the only Philippine lender in the initiative.
Launched in 2017 by J.P. Morgan, Royal Bank of Canada and Australia and New Zealand Banking Group Ltd., IIN lets banks access a ledger that would allow them resolve issues in compliance and other data-related inquiries that delay payments.
In turn, the network enables payments to reach beneficiaries faster and with fewer steps.
IIN is powered by Quorum, a permissioned-variant of the Etherium blockchain developed by J.P. Morgan.
“IIN will significantly improve the efficiency of cross-border payments, particularly as more banks participate and we evolve the functionality and use cases beyond compliance-related inquiries,” Emma Loftus, Head of Global Payments and Receivables at J.P. Morgan Treasury Services, was quoted as saying in the statement.
Asked for comment, UnionBank officials did not respond as of press time.
Blockchain is a distributed data ledger which involves a large network of entities where data is stored in “blocks.”
The storage units are continuously updated and being secured using cryptography, making data management and data-driven processes decentralized, tamper-proof and more transparent.
UnionBank has been using the blockchain technology for internal and external uses.
The bank currently uses the “disruptive” technology to store general circulars and operating manuals, enabling a more efficient distribution of the materials to employees.
It also uses the blockchain to connect rural banks into a financial network dubbed as Project i2i.
UnionBank booked a P4.7-billion net income in the first semester, 8% higher than the P4.4 billion logged in the same period last year.
Shares in UnionBank closed at P67.60 apiece on Wednesday, up 10 centavos or 0.15%. — K.A.N. Vidal