IT Giant TCS to Link Banking System to Ripple
Indian IT giant Tata Consultancy Services (TCS) has developed a blockchain-based, cross-border remittance solution that enables financial institutions to connect with other distributed ledger-based payments ecosystems, including RippleNet. The initiative is aimed at increasing transparency, reducing international remittance fees and settling payments in near real-time.
Also read: Wikileaks Co-founder Julian Assange Arrested After Ecuador Withdraws Asylum
Subscribe to the Bitsonline YouTube channel for great videos featuring industry insiders & experts
Traditional Banking Meets Blockchain
TCS’s in-house DLT solution, dubbed “Quartz Blockchain,” will allow banks to integrate existing payment systems to RippleNet – a global payments network that leverages Ripple’s consensus mechanism.
TCS released a document on its website stating, “The Quartz Cross Border Remittances solution enables banks/payments systems to connect to newer DLT based payment infrastructures (like RippleNet) for processing of Cross border FX remittance transactions.”
Using Quartz, financial institutions can simultaneously access multiple blockchain ecosystems from their existing banking systems, precluding the need for migrating to complex blockchain infrastructures. TCS states that the blockchain solution will shrink the liquidity needs of banks.
With Quartz, banks can track and settle cross-border transactions in near real-time. Also, it will significantly lower transaction cost by eliminating foreign exchange fees, which have plagued the current system.
The Indian software giant has made this integration possible by deploying Quartzy Gateway, a component of the Quartz Blockchain Suite, that permits integration of existing banking applications with blockchain networks using API’s.
As such, the API-based connectivity will also enable TCS BaNCS, core banking software suite developed by TCS that processes one billion accounts, to interconnect with Ripplenet.
“The Quartz Gateway seamlessly connects the TCS BaNCS Payments system to the blockchain based Payments platform using APIs, and supports services related to FX Quote finalization and debit/credit of beneficiary accounts.”
Middle Ground Between Blockchain and Traditional Banking
According to the TCS website, its banking network — TCS BaNCS — servers over a quarter of the global population with clients like lending giants Citibank. TCS also has a significant footprint in the Middle East.
Moreover, Ripple Labs — developers of the real-time gross settlement system — claim that it has over 200 banks using its payment protocol. The move is significant as it will allow banks to connect with other financial institutions using RippleNet.
It can convince more banks to use the revolutionary blockchain tech for real transactions. For that matter, the initiative can be crucial in increasing blockchain adoption.
Financial institutions around the globe have embraced distributed ledger technology. However, ten years since blockchain’s inception, no banks have migrated to a blockchain-exclusive system. Unfortunately, most lenders are still piloting the technology due to the complexity that blockchain brings.
However, TCS’s Quart Blockchain solution claims to absorb the complexity by providing a middle ground where banks leverage benefits of blockchain tech such as transparency, and security without even migrating from their existing banking ecosystems.
Last month, Bitsonline reported that TCS is developing a number of blockchain solutions using R3’s blockchain platform.
Will the innovative approach increase blockchain adoption in the financial sector? Share your views in the comments section.
Images via TCS