BNP Paribas and EY explore private blockchain for treasury operations

Written by Antony Peyton
17th October 2017

♫ I’m your private blockchain, a blockchain for treasury, I’ll do what you want me to do ♫

BNP Paribas ALM Treasury and EY have completed a pilot demonstrating the use of blockchain to improve global internal treasury operations for the bank.

The ALM Treasury department, which manages the bank’s internal ops, at the service of all three operating divisions of the group, carried out the pilot, tested internally this summer.

According to the duo, this pilot has highlighted how an internal, private blockchain could be used to “improve operational efficiency by providing a more integrated cash management approach between businesses, allowing greater flexibility and a 24/7 capability”.

One highlight from the pilot was that the working hours are extended up to 11 hours. BNP Paribas says this provides a common view of liquidity positions across locations and can “boost the interoperability of the legacy systems” combining the private blockchain with the existing IT environment via software robots and APIs.

Emmanuelle Bury, BNP Paribas chief operating officer for ALM Treasury, says: “We launched the initiative ten months ago with a view to address the current constraint on cash transfer capabilities limited to a range of seven to ten hours a day and ways to enhance operational efficiency. It was also important for us to start exploring the blockchain possibilities, in particular given the interest central banks grants to those technologies.”

In the lively blockchain arena, the issue of public and private blockchain can crop up now and then.

Xavier Toudoire, BNP Paribas, head of ALM Treasury IT strategy and architecture, explains: “When used in a private manner, blockchain allows the development of different business and operational processes that previously were not possible due to the distribution of data or trust among the parties in the system.

“Although it is still too early to determine how the technology will evolve and whether it is suitable for large-scale deployment, our pilot has demonstrated the clear strengths of private blockchain and its potential.”

The project is part of a larger group of initiatives at the bank. An example it cites is the Cash without Borders by its transaction banking business.

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