Singapore’s OCBC Bank has conducted a trial of a blockchain-based payment solution to make local and cross-border payments fund transfers.

The technology was designed by the bank and local technology vendor BCS Information Systems (BCSIS) and was used to transfer funds between OCBC’s Singapore and Malaysia subsidiaries, and between the bank’s Singapore unit and its private banking arm Bank of Singapore.

BCSIS managing director Ricky Lim said: “This blockchain solution will not only enable banks to inter-operate seamlessly across their own network, but also with other banks.”

OCBC termed the move as a Southeast Asia first, and said that the blockchain solution will mitigate the risk of fraud, reduce processing time, improve transparency, and lower costs of fund transfers.

OCBC SVP of group operations and technology Praveen Raina said: “This is a milestone not only for us but for Singapore as Asia's financial hub as we pave the way to revolutionising the traditional cross-border payments model.

"We hope this will be a catalyst for more banks to adopt the blockchain technology so that, together, we can achieve efficiency and cost effectiveness while delivering more high-value financial services to our consumers."

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By GlobalData

The bank also said that it plans to extend the use of blockchain to other financial products and service applications eventually.