Now swift introductions are a lot, cf40's eight-minute video is very clear, and I won't go any further and deeper than that.
Among them, the most important is this chart:
1.SWIFT sanctions are like WeChat suspensions
Payment = flow of funds + flow of information. SWIFT is responsible for the flow of information, trading messages, messaging systems, and is a postman responsible for delivering letters, not a porter of funds.
The banks responsible for moving the money are the banks, as well as the banks of the banks.
All commercial banks open accounts at the central bank, and the working day agrees on a daily cutting time, the difference is cleared, the bank's account is closed, and the accounts of the internal customers of the banks are also closed.
An important reason for the smooth experience of payment in China is thanks to Chinese Bank, which has made the level of interbank clearing computerization and efficiency rank the highest in the world thanks to the development of decades of development. Liquidation is insensible in the territory.
The reason why there are so many pain points of efficiency when making cross-border payments is fundamentally because there is no "global central bank". There is no way for all the world's banks to open an account with a central bank for clearing. There are more banks X and Y between the BANK of China A and Bank of America B in the above figure, which is the "correspondent banking", then this is a baton after stick running relay race, and the liquidation is felt across borders.
In the relay race of funds, the system that directs the handover of the baton is the information flow, and the information flow drives the flow of funds, which is the field of SWIFT. The importance of SWIFT, often called "financial nuclear bomb", is not easy to say whether it is right or wrong. To use an inappropriate analogy, SWIFT is like WeChat, and CHIPS' dollar clearing system is like WeChat Pay. If one day WeChat suspends you, your bank card can still be used, find an ATM or withdraw money, remit money (offline mode), tied behind Alipay or bank app can also be remitted (online mode), just to enter the card number or re-import the address book.
Yes, reintroduce the address book, which is a lot like rebuilding a SWIFT-like system.
2. The essence of Global Account
Open an account in the bank X, Y, agent liquidation, how to look so familiar? Is it a bit like the model of the third payment self-built network and channel before the reserve fund is centralized. Well, indeed~
Since banks and banks can act as agents for the clearing model, institutions and merchants can also do so, but for X and Y, one is a FI customer, and the other is mercant.
The establishment of Global Account for cross-border foreign exchange collection and settlement has become a technically feasible way.
Global Account is cross-border Alipay, and domestic banks are called umbrella accounts, internal accounts, and electronic bookkeeping books.
There are so many small and medium-sized micro and medium-sized enterprises in China that they have not all been abroad, and not all of them can open accounts abroad. A large institution goes to the United States bank to open an account, and its next n sub-accounts are assigned to customers who do import and export business. The client provides this account to the overseas customer who makes the payment. In this way, overseas payment becomes a domestic payment.
After one or two transfers, the funds are re-settled and re-entered.
The original agent liquidation between banks and banks has become a "collection + settlement" behavior between large institutions and banks. Large institutions have done credit enhancement and endorsement for small customers. Banks manage the risks of large institutions, and large institutions are the channel BD of banks.
It's like line X only cares about the risk of line A, and line A is responsible for its own customer's KYC and AML. Just replace Line A with an e-commerce company or an institution, and the bank can't do it without a bank?
Without a global central bank, no way to collect reserves, and no way to establish a global network, the status quo can only be like this.
However, there is a saying that Global Account is not a Global Network, the network is still a banking system, and most of the transmission of messages still depends on SWIFT.
According to the General Agreement on Trade in Services (GATS), cross-border financial services consist of four models: the "commercial presence" model, the "cross-border delivery" model, the "overseas consumption" model, and the "movement of natural persons" model. The business methods mentioned above belong to the "cross-border delivery" model, and there is a great compliance dispute in the mainland. Not only in the field of payments, but also in securities, in banks, there are similar companies. Not reviewed.
3. Cross-border slow is not bad SWIFT
In the example above, banks A and X, B and Y transmit information through SWIFT, and the CHIP system is used between X and Y, relying on the US dollar quota system Fedwire, which has its own messaging system. However, in fact, the messages of the clearing systems of banks in many countries also use SWIFT. SWIFT is only used across borders and is a stereotype.
Why do you still need to use SWIFT in China? Because of the cost, because of the scale effect. A bank's IT infrastructure, as long as it adapts to a set of norms, can cover the needs of domestic and overseas transactions, without considering security and extreme situations, the cost is reasonable.
"Cross-border is too slow, I want to build a new system to replace SWIFT and improve the timeliness of accounting." But how much can a telegram delay? In domestic messages, SWIFT can also be as silky smooth, and cross-border really can't rely on others. As long as there is no global central bank, as long as it still relies on the banking system, as long as it still relies on the agent clearing model, the relay race model does not change, and any BP that takes this as a gimmick and your foolish investment is not worth looking at.
4. The fastest way to deliver across borders
So, what about getting out of the bank account system? That's a good question. There have been a few recent news:
"ECB President Lagarde said at a recent meeting that the EU should establish a sound cryptocurrency regulatory framework as soon as possible to prevent Russia from escaping sanctions through cryptocurrency trading."
"Ukrainian supporters around the world have donated millions of dollars in cryptocurrency to Ukraine through non-profit organizations to help local people cope with the problem of currency depreciation."
"Russia has become the world's third largest bitcoin miner thanks to excess power and good technical equipment conditions, and both governments and citizens hold high levels of crypto assets.
"During the recent unrest among Canadian truck drivers, Canadian authorities blocked $10 million in remittances to protesters, but were unable to stop the inflow of more than $700,000 in bitcoin."
Why can cryptocurrencies be the quickest way to deliver across borders?
In essence, in fact, it has nothing to do with encryption or not, in fact, the role of cross-border and cross-regional exchanges: on the one hand, it can disintermediate various settlement systems, and on the other hand, it can be freely convertible with fiat currency.
In terms of process, China X finds a seller on the "x coin network" and buys a BT coin in RMB; after the coin string is generated, I tell Y in the United States that you go to the x coin network to find a buyer to sell and become a DOLLAR.
Note that this is illegal in China. illicit. illicit. Emphasize three times!
But the money did go out. At this moment of cross-border, there is no dependence on the banking system, and there is no need to use the SWIFT system.
Here, the role of the "x-coin network" is to replace the role of the above-mentioned banks X and Y, and further to fill the role of the long-missing "global central bank".
Since the Dutch invented the exchange in Amsterdam, for hundreds of years, there has not been a cross-border, cross-regional exchange (if it is not correct, it can correct me), is there really some deep-seated reason?
The above mechanism is characterized by: not controlled by the bank, not subject to SWIFT. Efficiency thieves are high, and processes are simple. KYC and AML are saved, can it not be high? Again, don't rely on the flow of information.
There is also a potential feature: exchanges (central banks) act directly with end customers as counterparties. The central bank-bank-terminal dual-tier delivery system is one layer less. What are the implications? A paper is omitted here.
5. Broker/agent model for cross-border delivery
The exchange model replaces the role of the central bank, and the number of times is a bit big. Is there any other model? Last year london listed a company, WISE, which is well worth studying.
The founders are British entrepreneurs of Estonian origin, Kristo Kaarmann and Taavet Hinrikus, one of whom wants to send money from England to Estonia and the other from Estonia to Britain, so one day they met and found out why we were looking for a bank.
The media report reads:
In essence, TransferWise is actually a matching platform, mainly to match people with different needs and supplies.
For example, If Zhang San needs a sum of pounds sterling, and TransferWise helps Zhang San find Li Si with the same value of euros or other currency needs, then TransferWise will match Zhang San and Li Si at the market price, let Zhang San send a sum to TransferWise's euro account, let Li Si send a sum to TransferWise's pound account, and then TransferWise give them the currency they need. They remit money through TransferWise, and instead of doing anything really "international money transfer" business, two local transfers occurred.
After reading it, the first reaction was: Isn't this an underground money house? Pair knock mode.
However, after reading more information, it is found that the people's matchmaking platform does not gather the domestic payees and payers, and then gather the overseas payees and payers, and calculate the difference between the two sides of the total number? This is actually a bank.
Yes, WISE holds 62 licenses, digital banking or payment licenses in 42 countries. Money laundering without a license.
WISE this hanging is actually in line with western union and other remittance companies, the latter through the development of foreign exchange services agent agent agent, like 711 convenience stores and pharmacies or something, you give 711 clerk cash, the clerk gives you a string of code MTCN (Money Transfer Control Number); you give this string of codes to the original recipient in a foreign country, he will MTCN in the home country to find a Western Union remittance agent, The agent gives the local currency cash to the payee.
At the agreed time, the liquidation of funds from the agents in the two places was completed through Western Union.
Here, is Western Union the "x-coin network" mentioned above, cross-regional exchanges, and global central banks? What is the difference between MTCN and cryptocurrency tokens?
By the way, do you know when Western Union was founded? In 1851, I was between the two Opium Wars.
Nothing new under the sun. Something that is essentially common, I said before that it has not appeared, seems to be presumptuous.
It seems that the Western Union model is very backward, right? This year, there is still an agent to develop, and the agent also has to have a money box to cash the payer.
However, have you ever heard of a business that UnionPay has had before, "helping farmers withdraw money"?
Do you know what percentage of the world's population is unbanked? Did you know that most national banks have a minimum deposit requirement? Did you know that many countries have a weekly salary system for blue-collar workers, encouraging timely fun and not encouraging savings, so that they are always underbank people?
Again, thanks to the inclusiveness of the policy orientation, thanks to the Chinese Bank, thanks to the high-level interbank clearing infrastructure that makes the liquidation process smooth, thanks to the perfect citizenship information verification system that makes the account real-name system possible, and thanks to the diligence and frugal genes of our farming peoples. The combination of these makes China's electronic payment method unique in the world.
Perhaps, we should think about it and make some efforts to improve the global level.
WISE, Western Union, x-coin network, SWIFT, QR codes, the abandonment of these things, may be able to grow something different.
Something different under the same essence.