US banking giant JPMorgan Chase has partnered with Siemens to develop a blockchain system for the German industrial group’s payments, in what the two companies said was a first-of-its-kind application, Financial Times reports.
According to the report, Siemens said the improved automation is needed to process the far greater number of payments it expects due to the growing popularity of payment models like pay per use.
“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,” said Heiko Nix, head of cash management and payments, Siemens.
“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.”
The system is being used to transfer money automatically between Siemens’ own accounts. It is currently only used for US dollars, but there are plans to allow euro transfers next year. The companies declined to comment on the volume of payments the new system had processed to date.