As reported by the Financial Times on Monday, December 20, the two companies claim that the system is a unique application. Siemens says it needs improved automation to process a growing number of payments it expects as payment methods like pay-per-use gain in popularity.
âIf the business remained the same as it is today, I would say we are doing well in terms of our cash flow setup. We can automate a bit and maybe reduce costs and cash allocation, âsaid Heiko Nix, head of cash management and payments at the German industrial company, in an interview with the FT.
âThat’s not the reason we’re doing this. The reason is that we are seeing a huge change due to emerging digital business models as we will no longer be able to forecast cash flow, for example. “
For now, the system – developed with Siemens with the blockchain service from JP Morgan Onyx – is only used to transfer money between Siemens’ own accounts, in US dollars, although there are plans to add more. transfers in euros in 2022.
Naveen Mallela, global head of coin systems at Onyx, says the system allows programmable payments to go beyond uses like direct debits.
âYou want more flexible rules or flexible triggers, that’s where the current infrastructure is lacking,â Mallela said.
The article notes that the move comes at a time when banks – HSBC and Wells Fargo among them – are stepping up efforts to integrate blockchain technology into their infrastructures.
Read more: JPMorgan’s Onyx Opens Infrastructure to Disrupt Cross-Border Payments
PYMNTS spoke with Mallela earlier this year about the growing awareness among financial institutions of the need for industry collaboration to address the frictions associated with cross-border payments.
âMy conversations with most banks have [realized] that the industry needs shared platforms, âhe said, adding thatâ these are not bank specific products, these are not bank specific platforms. Bank. These are industry-wide shared platforms and decentralized networks.