JPMorgan Chase’s blockchain payments platform looks to be expanding to Japan, and soon.
The U.S. banking multinational is eyeing a launch for its Interbank Information Network (IIN) in the East Asian nation possibly in January, executive director Daizaburo Sanai told Bloomberg in a report on Monday.
Built on Quorum, a permissioned blockchain based on ethereum and developed by JPMorgan, IIN is designed to enable member banks to exchange information in real time, allowing them to verify a payment has been approved. This, the bank says, helps reduce friction in international payments and ultimately leads to faster processing times.
The system is also a way of reducing the risk of money laundering, which is why over 80 Japanese banks have expressed an interest in joining IIN, Sanai said.
Japan has been under pressure to up its anti-money laundering game since the Financial Action Task Force found “numerous and serious deficiencies” in 2014.
IIN’s ability to reduce delays in the payments process would allow the member banks to quickly collaborate with law enforcement in suspected cases of money laundering, an official at Sumitomo Mitsui Trust Bank – one of those interested in joining IIN – told Bloomberg.
Sanai agreed, saying the system makes the screening of payment recipients “faster and more efficient.”
As of mid November, there were approximately 365 banks signed up for the initiative from other parts of the world, according to JPMorgan’s website. OCBC became the first Singapore bank to join IIN in September. Deutsche Bank – the number one bank globally for the clearing of euro-denominated payments – also became a member the same month.
Should all 80 Japanese banks join IIN, they’d comprise the biggest group from any single nation, according to the report.