Canada-based ATB Financial, SAP SE, fintech start-up Ripple Labs Inc and ReiseBank AG have collaborated to send the first real international blockchain payment from Canada to Germany.
Using a network built on the SAP HANA Cloud Platform, SAP Payment Engine and Ripple’s enterprise blockchain solutions, ATB transferred CA$1000 (EUR667) to ReiseBank. SAP also provided a mobile user interface for demonstration purposes.
The transaction, which typically would have taken between two and six business days to process because of requirements such as settling with the counterparty bank and reconciling accounts, was completed in around 20 seconds.
The blockchain was originally created as the foundation for trading digital currency bitcoin, and is a distributed ledger that allows a network of computers to settle transactions securely and almost instantly.
SAP and Ripple worked with a team at ATB Financial to design and build a proof-of-concept prototype based on the technology in nine working days.
“Although we are very much still in the early stages of blockchain adoption, it was highly encouraging to see in a true demonstration the potential it has in transforming cross-border payments, making them almost instantaneous and reducing potential errors,” said Curtis Stange, chief strategy and operations officer, ATB Financial.
“Using SAP HANA Cloud Platform, we’re able to experiment and be nimble with emerging innovations like blockchain. The next stage for us, working with SAP and Ripple, will be to understand how the front-end experience should work for the benefit of our customers,” Stange added.
The test transaction demonstrated how banks can improve the efficiency of cross-border payments to enhance their global networks.
“Banks like ATB that take a positive and proactive approach to blockchain now can position themselves advantageously for when the technology enters the mainstream,” said Bernd Leukert, member of the Executive Board of SAP SE, Products and Innovation. “ATB’s blockchain transaction underscores the value of running a business on a full-fledged digital core so it can react quickly to emerging possibilities and avoid the threat of disruption.”
In 2011, ATB Financial successfully migrated its entire legacy banking system to a major new core system built using SAP solutions.