Projects per year
Abstract
Crucial for international trade, cross-border payments are conducted via the correspondent banking (CB) system, a decentralised network of bilateral agreements between more than 11,000 banks in different jurisdictions, and supported by a centralised messaging network (SWIFT). This global twin infrastructure consists of highly complex socio-technical and socio-spatial arrangements pressured to change, but resistant to it. Beset by inefficiencies, from which the gatekeeper incumbent banks profit, the international payments system lacked alternatives until the recent tech threat of disintermediation and re-organisation of legacy serial messaging chains to big data arrangements and centralising platformisation. We show how the CB/SWIFT nexus, an integral part of the financial and advanced services providers (FABS) complex and, as such, also a specific and important part of obligatory passage points (OPPs), creates and extracts monopoly rents, now and into the future. Challenged by new technology and the resulting push to re-form its (global) organisational architectures, understanding and conceptualising change in and of OPPs – here, the global payment infrastructure – is therefore vital. We capture the complex relationships between the CB and SWIFT for a better analytical understanding of change at the system level. Methodologically, the analysis draws on insights from an explorative research design, including 30 semi- structured expert interviews. We show that mobilising 11,000 banks across the globe to innovate and upgrade from rent extraction to new, forward-looking sources of profit, that is, data, is no straightforward process despite the governance of SWIFT to ‘nudge’ its member banks to preserve incumbency and, ultimately, its survival.
Original language | English |
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Article number | 104007 |
Journal | Geoforum |
Volume | 151 |
Early online date | 10 Apr 2024 |
DOIs | |
Publication status | E-pub ahead of print - 10 Apr 2024 |
Keywords
- innovation
- SWIFT and correspondent banking
- Payment transaction data
- Platformisation
- Maintenance
- Change governance
Projects
- 1 Finished
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FINWEBS: Stabilising an unstable industry: The role of agency in interconnecting international financial centers
Dörry, S., Robinson, G. & Derudder, B.
Luxembourg Institute of Socio-Economic Research (LISER), Luxembourg National Research Fund (FNR)
1/09/17 → 31/12/22
Project: Research
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Correspondent banking, SWIFT, and the geographies of financial infrastructure: Technological and organizational change in cross-border payments
Robinson, G., 6 Jun 2023, Ghent: Ghent University. 176 p.Research output: Types of Thesis › Doctoral Thesis
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Global networks of money and information at the crossroads: Correspondent banking and SWIFT
Robinson, G., Dörry, S. & Derudder, B., Apr 2023, In: Global Networks. 23, 2, p. 478-493 16 p.Research output: Contribution to journal › Article › peer-review
Open AccessFile136 Downloads (Pure) -
The blockchain challenge for Sweden’s housing and mortgage markets
Proskurovska, A. & Dörry, S., 2022, In: Environment and Planning A. 54, 8, p. 1569-1585 17 p.Research output: Contribution to journal › Article › peer-review
Open Access -
The dark side of innovation in financial centres: legal designs and territorialities of law
Dörry, S., 4 Sept 2022, (E-pub ahead of print) In: Regional Studies. p. 1-12Research output: Contribution to journal › Article › peer-review
Open AccessFile120 Downloads (Pure) -
Capturing a moving target: interviewing fintech experts via LinkedIn
Robinson, G., Dec 2021, In: Area. 53, 4, p. 671-678 8 p.Research output: Contribution to journal › Article › peer-review