Goldman Sachs has started using the Finteum DLT-based intraday liquidity management platform, which is now processing $1 billion in weekly transactions for FX swaps. Other users of the solution include UBS and NatWest, with additional international banks in the advanced stages of onboarding. The long term potential is huge given global FX trading reached $9.6 trillion per day in April 2024, with FX swaps making up the largest slice at $4 trillion.
As transactions, both retail and institutional, migrate to a real time basis, unpredictable intraday liquidity demands will continue to rise. Intraday FX swaps and intraday repo are key tools for banks to manage intraday liquidity, with Finteum supporting both, although the current focus is on FX swaps. These involve banks lending a currency such as USD in exchange for another currency such as EUR, with the transaction reversing hours later. Over the medium term Finteum CEO Brian Nolan told Ledger Insights that he additionally envisages the company supporting overnight repo and FX swaps as well as Tom-next (tomorrow-next day) FX swaps.
Donal Quaid, Group Treasurer of NatWest Group said, “Technologies like DLT are transforming how quickly and confidently institutions can see, deploy and control liquidity throughout the day – our work with Finteum is an important part of this evolution as it enables greater speed, flexibility and certainty as we adapt to a world where funding and settlement happen continuously rather than at set points throughout a day.”
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