New CBA collaboration will enable 60-second cross-border payments
A new cross-border payment collaboration between the Commonwealth Bank and The Bank of New York Mellon will allow Australian businesses and customers to receive payments in under one minute.
Through the cross-border payments partnership between Commonwealth Bank of Australia (CBA) and The Bank of New York Mellon (BNY), Australians will receive international payments from BNY’s customers in as little as 60 seconds.
According to CBA, these ‘1 minute’ BNY commercial payments will apply to any Australian business or individual no matter who they bank with.
“Through the new arrangement, BNY commercial payments from overseas to businesses and individuals with Australian bank accounts will now be available to the final beneficiary in under a minute, 24 hours a day, seven days a week,” CBA said.
The efficiency of the cross-border payment has been enabled by harnessing Australia’s New Payments Platform (NPP) and the International Payments Service (IPS).
This allows the last mile of BNY’s cross-border payments to Australia to be processed by CBA via the NPP.
This process offers cost transparency, robust security, and faster settlement.
CBA said this process has been designed to help Australian businesses and customers as cross-border payments can be a hindrance.
“Making and receiving cross-border payments can be challenging for customers due to the cost and processing times,” CBA said.
“Inefficient payment processes also have the potential to hinder economic growth by impeding the flow of capital across borders.”
Executive general manager, payments, at CBA, Ethan Teas, said CBA is “thrilled” to have collaborated with BNY and leveraged the IPS initiative to enhance the speed of cross-border payments into Australia.
“This initiative demonstrates our commitment to supporting our banking partner to meet customer demand for instant and frictionless cross-border payments,” he said.
“This represents a significant leap forward in the evolution of speed in global payments, allowing CBA to empower our overseas banking partners to deliver great outcomes for their customers in supporting faster settlement of payments bound for accounts in Australia.”
The NPP was first launched in Australia in 2018 to facilitate real-time payments 24/7 between participating financial institutions.
According to CBA, the platform enhances the speed and efficiency of domestic transactions as well as recently having introduced “instant interoperability” via the IPS.
“This service enables the Australian dollar leg of inbound cross-border payments to be processed by the NPP and in doing so aligns with the Financial Stability Board’s vision for a more interconnected global financial system,” CBA said.
By the bank having allowed IPS, flexibility will also be enabled in settling transactions up to mutually agreed payment value thresholds.
This will enable the support of a safe, sound, and secure transition to near real-time settlement while managing risk and entitlement.
Executive platform owner at BNY, Carl Slabicki, said the collaboration has allowed for BNY to provide help and efficient service to another market.
“Adoption of similar services like the IPS in Australia is expected to continue globally as demand for an instant cross-border experience rises,” he said.
“Collaborating with CBA allows BNY to enable yet another market in our ambition to facilitate instant, frictionless payments from account-to-account anywhere in the world.”
Teas said this is just the beginning for CBA in terms of improving payment structures.
“Demand for seamless and instantaneous cross-border payments continues to grow and we’re focused on taking advantage of advancements in payment infrastructure, particularly the development of faster payment rails, to help our customers benefit from fast, safe and frictionless payments experiences,” Teas said.
