Visa launches commercial blockchain-based payments system with B2B Connect

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The payments giant Visa announced that it has launched a new blockchain payments system called B2B Connect.

The company aims to use blockchain to promote faster, cheaper and more transparent payments.

At present, most cross-border payments are mainly facilitated by the Society for Worldwide Interbank Financial Telecommunication, or Belgian organization Swift.

Kevin Phalen, Senior Vice President, Global Head of Visa Business Solutions, said that the new product "will accelerate the evolution of how commercial payments move around the world".

The Visa B2B Connect launch will cover more than 30 global trade corridors, with an aim to expand to as many as 90 markets by the end of 2019.

Visa's blockchain facilitates direct bank to bank transactions and eliminates the friction of countless intermediaries who typically exist in the global remittance market.

Those involved in the development include Bottomline, FIS and IBM, and Visa has also worked with Hyperledger Fabric. The move is meant to help the payments giant diversify its business, which now heavily relies on card-based transactions.

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The network will enable direct bank-to-bank transactions from the bank of origin to the beneficiary, removing the need for intermediaries.

Earlier this year, software startup DataLight released a report claiming that bitcoin (BTC) has a potential to replace global payment systems such as Visa and MasterCard within ten years. Besides this, it's complicated to monitor the transfer's status and anticipate the cost associated with it, including the Forex rate that comes with it. Financial institutions can see payment fees upfront.

The platform was developed in partnership with IBM, FIS and Bottomline Technologies.

Visa's B2B Connect platform can also support and work alongside legacy systems, meaning banks don't have to completely abandon older systems during the transition.

"The B2B Connect rails are new, so Visa isn't leveraging the ubiquitous credit card rails it has spent decades building and maintaining".

Visa Inc. (NYSE: V) is the world's leader in digital payments. "With Visa B2B Connect, we are making payments quicker and simpler, while enhancing transparency and consistency of data", he added.

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