Iberpay which operates Spain’s national payments network ran a Proof of Concept (PoC) for blockchain-based smart payments with five Spanish banks, Banco Sabadell, Santander, Bankia, BBVA and CaixaBank. It defined smart payments as those triggered by a smart contract.
One of the aims of the project is to enable corporates to schedule automatic payments which could be triggered by a smart contract based on a particular event such as the delivery of merchandise. Other benefits include efficiency, traceability and integrity for payments.
The project started in October and is expected to run for six months. The blockchain network has six nodes with each bank operating a node, plus one for Iberpay. Grant Thornton is the technology advisor.
Initially, it was unclear whether smart contracts were just used to trigger regular payments via an API. However, Grant Thornton’s comments imply this is an e-money test. “We are developing a payment instrument in Blockchain that could allow financial institutions to issue regulatoryly viable electronic money. With this new scope, we would put into production a pioneering solution at European level,” said Carol Lago, Senior Manager of Technology and Innovation Consulting at Grant Thornton.
Spain is one of the more advanced economies when it comes to deploying blockchain. Two of the banks, Santander and BBVA, have multiple high profile blockchain initiatives. Santander recently issued and redeemed a bond on the public Ethereum blockchain. And BBVA has carried out numerous bond and loan issuances using its blockchain platform.
Two weeks ago the central securities depositary IBERCLEAR participated in a proof of concept for collateral pledges run by Spanish stock exchange group Bolsas y Mercados Españoles (BME).