Italian banking system goes on blockchain to cut operational risk
Banca d’Italia plays a key role behind the scenes in embedding distributed ledger at the core of the country’s banking system.
At the end of April, 32 banks in Italy went into full production with one of the first large-scale deployments of blockchain in interbank markets.
While JPMorgan was far ahead of the pack in October 2018, when it launched the interbank information network (IIN) that allows its correspondent banks quickly to chase down details of failed cross border payments and rectify them, the new Spunta Banca DLT application is set to connect up an entire domestic banking system on distributed ledger technology (DLT).
Associazione Bancaria Italiana (ABI), the Italian Banking Association, built the application to swiftly and efficiently reconcile discrepancies in the separate ledgers for so-called nostro and vostro accounts that Italian banks hold for each other. It operates as a permissioned network on R3’s Corda enterprise platform.
It removes the pain of reconciling mismatches that used to take days or weeks to resolve. Mismatches can now be spotted and reconciled immediately - Charley Cooper, R3
Among the 32 banks now using it are leading institutions such as Banca Mediolanum, Banca Monte dei Paschi di Siena, Intesa Sanpaolo, UBI and UniCredit, as well as the Italian operations of foreign banks, including BNP Paribas and Crédit Agricole.