National Bank of Bahrain (NBB) has signed two cross-border payment agreements in three days. One adds a payout network to its existing infrastructure; the other looks at moving the Bahraini dinar onto a blockchain settlement system.
On 13 October, NBB said it had partnered with TerraPay to expand its international payouts. NBB will reach TerraPay’s network through its existing Swift connection, so it doesn’t need to build a separate link in each destination market. TerraPay accepts Swift messages in the ISO 20022 standard and pays out in real time to bank accounts, mobile wallets and local payment systems. It says its network covers more than 12 billion endpoints.
Vineet Munot, NBB’s group head of transaction banking, said,
“The bank sees an opportunity to connect our customers in Bahrain and the region with a wider range of payment destinations.”
Ani Sane, TerraPay’s co-founder and chief business officer, said:
“Banks want to extend their international payment reach without having to build and maintain separate connections.”
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Studying dinar settlement on Partior
On 15 October, NBB signed a memorandum of understanding with Partior, a blockchain-based network for interbank payments and settlement, to study whether the Bahraini dinar could settle on Partior’s platform, with NBB acting as the dinar settlement bank.
Partior’s network currently settles US dollars, euros and Singapore dollars through its founding settlement banks. Its backers include DBS, Deutsche Bank, JPMorgan, Standard Chartered and Singapore’s state investor Temasek, Ledger Insights reported, and it already has a similar exploratory arrangement with Emirates NBD in the UAE. The two will look at the operating model, implementation requirements, technical feasibility and regulation before deciding whether to go ahead, TechNode Global reported. No launch date or commercial terms were announced.
Humphrey Valenbreder, Partior’s chief executive, linked the agreement to the company’s growing presence in the Gulf, according to the coverage.
Two routes for the same flows
The two deals take different approaches. TerraPay works over Swift, the messaging system banks already use, and handles the last step of delivering money in the destination country. Partior replaces part of the correspondent banking chain with a shared ledger where participating banks settle directly.
For NBB, the TerraPay link can run on systems it already has. The Partior study is a longer bet: it would mean Partior adding a fourth currency, and the study itself covers the regulatory questions. Neither NBB nor Partior has said when the study will finish.
