Programmable payments allow a wider range of rules than conventional conditional payments. JP Morgan provides a new “If-This-Then-That” interface via its online treasury portal.
“This will take Siemens to the next level of automation to not only optimize the use of working capital but also enable data-driven digital business models and support the scalability of our Siemens business from the treasury side,” said Dr. Peter Rathgeb, Group Treasurer of Siemens AG.
Examples of programmability include the ability to specify rules for how to top up a bank account if there’s a shortfall. Payments can respond to events such as margin calls or if an asset or good is delivered.
The bank started trialing JPM Coin in 2019, and it’s now used to process more than $1 billion in payments most days. Even without programmability, the solution enables atomic settlement and 24/7 cross border transactions between accounts within the bank.
“Programmability has been a key objective for digital currencies and tokenized money since the beginning,” said Naveen Mallela, Head of Coin Systems, Onyx by JP Morgan. “This is an important milestone and foundational for real-time, automated and programmable treasury.”
There’s no doubt that JP Morgan has been a trailblazer in this area. There’s now a broader movement by the banking sector towards tokenized deposits. In the last couple of months Citi launched its Citi Token Services. This month HSBC announced two tokenized deposit trials with Ant and Visa. That means the world’s three largest systemically important banks (1. JPM, 2. HSBC, 3. Citi) are leaning into tokenized deposits.