BNP Paribas has joined the Sterling Fnality Payment System (£FnPS), becoming the latest major bank to connect to the DLT-based wholesale payment network. Its first transaction on the platform, an interest rate swap payment with Lloyds, has now been completed, according to a Fnality press release.
The £FnPS is operated by Fnality and runs on distributed ledger technology (DLT). It enables near-instant settlement using a digital representation of funds held at the Bank of England, effectively allowing banks to transact in a form of central bank money via blockchain infrastructure.
Real-time settlement
The interest rate swap payment between BNP Paribas and Lloyds marks another practical use case for on-chain settlement of complex financial instruments. While the £FnPS is still at an early stage, proponents argue that systems like this could reduce settlement risk and improve liquidity management across capital markets.
Unlike traditional interbank settlement processes, the DLT-based model allows for real-time, peer-to-peer settlement with finality, removing the need for intermediaries and manual reconciliation. Fnality aims to position its infrastructure as a bridge between traditional financial systems and tokenised markets.
Growing participation
BNP Paribas’ involvement follows previous activity on the platform by Lloyds and other early participants. Its decision to settle an interest rate swap payment via £FnPS is seen as part of a broader exploration by large banks into the use of DLT for core market functions, including collateral and liquidity management.
