The Monetary Authority of Singapore (MAS) announced its partnership with R3 blockchain consortium in order to conduct inter-bank payments using the distributed ledger technology.

The partnership project will include other financial institutions and aims to potentially avail a payment system for participants in order to transact in different global markets, which are presently limited by time zone differences and office hours, the official release said.

“The simplification of processes that comes from having a single and coherent distributed record of information makes blockchain technology, an attractive solution for the financial sector. MAS is engaging with the industry and working closely with our partners to explore innovative payment solutions,” Sopnendu Mohanty, Chief FinTech Officer, MAS, said.

The project will use distributed ledger infrastructure and develop a pilot system to issue and transfer funds among participants. This system will tend to be more flexible against stoppages by decentralizing and distributing the software, which records payments. The participants can rely on this immutable record of transactions to reduce the cost of long record keeping.

The consortium of financial institutions includes Bank of America Merrill Lynch, The Bank of Tokyo-Mitsubishi UFJ, Ltd, Credit Suisse, DBS Bank Ltd, The Hong Kong and Shanghai Banking Corporation Limited, JP Morgan, OCBC Bank, Singapore Exchange, among others.

“We are delighted to build on our relationship with MAS and bring together a large group of financial institutions from both Singapore as well as global players from our membership. Payments and the representation of fiat currency on blockchain is a potentially significant use case for distributed ledger technology and we firmly believe that partnership between regulators, central banks, and the financial services sector will accelerate solutions to maturity,” Tim Grant, CEO of R3’s Lab and Research Center, and member of the MAS International Technology Advisory Panel stated.

The results of the project will give guidance on future projects like cross-border payments, automation of securities issuance, trading, and settlements, with the help of blockchain technology.

Last week, R3, the leading blockchain consortium of over 70 of the world’s largest financial institutions, teamed up with MAS to launch its first dedicated distributed ledger technology (DLT) Center of Excellence in Singapore in a move to expand its services in Asia.