And the blockchain payments race is on. Payments networks American Express and Visa have partnered with separate blockchain startups, Ripple and Chain, respectively, to offer corporate clients business-to-business, crossborder, blockchain-enabled payments. Mastercard announced a similar service in October, though it's unclear whether the solution is proprietary or a partnership.
The Amex solution is limited to sending payments from the U.S. to businesses that bank with Santander in the U.K., but Amex says it could expand in the future. Amex's FX International Payments platform has integrated Ripple's payment network RippleNet, which will route noncard payments to Santander. The companies claim transactions will be faster, less expensive and more transparent than existing methods while remaining just as secure. "Transfers that used to take days will be completed in real time, allowing money to move as fast as business today," said Ripple CEO Brad Garlinghouse.
Visa's solution, Visa B2B Connect, which was announced last year, is in pilot with Commerce Bank in the U.S., Shinhan Bank in South Korea, UnionBank of Philippines and United Overseas Bank in Singapore. Visa similarly claims faster, more transparent and secure B-to-B payments between participating banks.
Earlier this month, Mastercard filed a patent application with the U.S Patent and Trademark Office to build a blockchain-based database to process electronic transactions, as reported by CoinDesk.
Blockchain's Emergence into Travel
Travel suppliers like Lufthansa and Innfinity Software Systems are moving toward blockchain-based distribution platforms. AirPlus has said it's examining blockchain applications for the business travel payment sector. While they admit to blockchain's overall benefits—faster, easier, more secure and less expensive payments—they've mostly dismissed the technology's immediate benefits or value for investment.
With a major payment network like Amex implementing blockchain in the B-to-B space, the race among all payments suppliers may accelerate. "I think it's just around the corner," said GoldSpring Consulting partner Colleen Black. There's an urgency among providers to implement the technology first, with an inkling that whoever does will rule travel payments or at least have an outsized opportunity to control its transformation.
"The recent announcement by American Express, as well as the one Mastercard made on patenting a blockchain, shows the intention, commitment and investment into further developing payment," Black said. "It's a good first step. I see blockchain as a great way to transfer funds in a quicker easier, cheaper way, and I think it will revolutionize payment. But, again it's just the first step."