JP Morgan to help Siemens develop new blockchain payments system
US financial giant JP Morgan is developing a blockchain-based payment system in partnership with German-based major technology company Siemens, the Financial Times reported Monday.
Through this partnership, the companies aim to improve the efficiency of remittances between Siemens-related accounts by automating various tasks required for recording and authentication, the report noted. Initially, transactions will be dealt in US Dollars with support for Euros to be added in 2022.
Heiko Nix, head of cash management and payments at Siemens, told the FT:
“If the business would stay the same as it is today, I would say we are fine regarding our treasury set-up. We can automate a bit and maybe we reduce costs and cash allocation … This is not the reason why we are doing this. The reason is that we are seeing a huge change due to the emerging digital business models, because we will no longer be able to forecast cash, for example.”
JP Morgan’s blockchain unit ‘Onyx’ will develop the “first-of-its-kind application”, as described by both the companies. Founded in 2020, Siemens has become the first major client for Onyx. The new application will allow Siemens to process a higher number of transactions as pay-per-use payment models become more popular by the day.
2021 has reported an influx of new technologies, especially in blockchain and cryptocurrencies, adopted by industrial giants to improve their efficiency of day-to-day operations. Apart from JP Morgan, many banking giants like Citi, Wells Fargo, US Bancorp, and PNC, have started to shift their focus towards the budding industry.
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