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JPMorgan Chase and Co., the American multinational finance titan, has announced its partnership with six Indian banks to facilitate interbank dollar transactions through a blockchain-based platform.
This initiative aims to further propel New Delhi’s endeavor to position Gujarat International Finance Tec-City, also known as GIFT City, to compete with other prominent international finance centers like Singapore, Hong Kong, Abu Dhabi Global Market (ADGM), and Dubai’s IFC.
JPMorgan to Collaborate with Indian Banks
Kaustubh Kulkarni, JPMorgan’s senior country officer in India and deputy head of Asia Pacific, mentioned in an interview that they would be conducting a pilot project over the next few months to analyze the experiences of the banks.
Among the banks involved are leading private credit institutions such as HDFC Bank Ltd., ICICI Bank Ltd., Axis Bank Ltd., Yes Bank Ltd., and IndusInd Bank Ltd., in addition to JPMorgan‘s own banking unit in GIFT City.
The banking giant aims to employ blockchain for faster and more efficient interbank dollar transactions. At present, with existing settlement systems, transaction completions take approximately a few hours. However, with blockchain, these transactions can be executed almost instantly.
JPMorgan to Use Its Blockchain Platform Onyx
Kulkarni clarified that JPMorgan aims to facilitate transactions 24/7, enable instant transactions, and support the working hours and time zones of GIFT City banks by leveraging blockchain technology.
Following the approval of the International Financial Services Centre Authority, the pilot project is planned to be launched on Monday, using JPMorgan’s blockchain platform, Onyx.
Onyx, JPMorgan’s blockchain-based platform for wholesale payment transactions, was established in 2020. JPMorgan is not the only major bank venturing into GIFT City, as several systemically important international banks, including Deutsche Bank and MUFG, have opened branches at the center, demonstrating their seriousness.
