Alice Kim (Director, Business Development) discusses the recent international remittance pilot with Shinhan Bank and the largest financial institution in Taiwan.
Last week, Taiwan’s largest financial institution and the oldest bank in South Korea - Hedera Governing Council member Shinhan Bank - completed an international remittance pilot, validating Hedera’s viability for EVM-based stablecoin issuers everywhere.
In collaboration with SCB TechX, the proof-of-concept (PoC) pilot achieved real-time settlement and real-time foreign exchange (FX) rate integration across the Thai Baht (THB), New Taiwan Dollar (NTD), and South Korean Won (KRW).
Whilst the official findings will be published over the coming weeks, we see once more that international remittances on Hedera proved orders of magnitude more efficient than legacy banking systems across all axes - fees, settlement time, real-time traceability, and 24-hour market access.
Establishing the Pilot
Following the first successful international remittance pilot with Shinhan Bank and Standard Bank that was carried out from August to November 2021, this second pilot came as a natural next step for Shinhan. For SCB TechX and our Taiwanese partner, however, this was uncharted territory.
During the 2022 Singapore Fintech Festival, we met the Web3 lead at SCB TechX, the tech enabler of Siam Commercial Financial Group. TechX understood the limitations of banks and quickly saw how Web3 could advance traditional finance institutions. The largest financial institution in Taiwan came to us through a member of the Hedera Governing Council, reflecting how the diverse Governing Council fosters innovation and partnership across industries.
For each bank, the current processes of sending and receiving an international remittance presented them with many reasons for joining the pilot. Such existing bottlenecks in legacy systems include slow processing times, expensive transaction fees, limited operating hours, a lack of system standardization, and system complexity. Hedera’s technical specs presented a clear competitive advantage for both financial institutions, providing them with infrastructure that is highly scalable, secure, and easy to manage.
Throughout this pilot, there was an extensive amount of collaboration across multiple organizations. Swirlds Labs led the technical development and were an excellent resource for all partners, ensuring that the banks could build as smoothly and efficiently as possible. I’d like to shout out Pathorn Tengkiattrakul and Greg Scullard in particular for their exceptional work.
Alongside the Swirlds team, Sabrina from The HBAR Foundation, Jared from Standard Bank, Minju from Shinhan Bank, Andre from SCB TechX, Nicholas from Taiwan Blockchain Association were also key figures in making this pilot happen. We’re looking forward to continued collaboration on all fronts in the coming months
The Asian Market
Asia is a key focus area for The HBAR Foundation. Perhaps due to the symbiotic nature of business and consumerism in Asia, Web3 adoption is inherently multidisciplinary, with gaming and NFTs being of particular note. Alongside this, there is clear institutional interest and participation.
We are seeing banks across the continent show an ever-increasing interest in asset tokenization and digital assets. Hedera, with Asian giants Nomura Bank, DBS Bank, and Shinhan Bank all on the Council, is proving itself as a clear go-to partner in the region. The pilot has strengthened this further.
Shinhan has been a leader in this regard. Since the first day of their council membership, they have actively explored use cases on Hedera and are only doubling down on its innovation and openness to collaboration throughout the ecosystem.
Shinhan is just one of many financial institutions to explore real-world solutions on Hedera. We’re excited to continue to support them as their products evolve beyond the pilot and proof of concept phase.