Fujitsu published a press release Monday announcing the Japanese information technology company was selected as an "application development vendor" for a "field trial" to explore the scope of a collaborative blockchain platform initiated by the Japanese Bankers Association. Fujitsu will examine the potential of blockchain technology as a "funds transfer settlement system" along with nine banks.

This field trial will utilize a dedicated digital currency for interbank settlements to assess the functionality of the system. The aim is to see if it can work as an "economical new interbank funds transfer settlement system," particularly for small-scale transactions that use real-time gross settlement method. 

"Fujitsu will play an instrumental role in this field trial by building and providing the trial's ICT [information and communication technology] platform, namely, the new interbank settlement platform, using blockchain technology. It will additionally leverage the P2P [peer to peer] money transfer platform it developed in fiscal 2017 with three major banks to generate the money transfers to other banks that will trigger interbank funds transfer settlement," the release read.

The participating banks in the field trial include Sumitomo Mitsui Banking Corporation, Resona Bank, the Joyo Bank, Sumitomo Mitsui Trust Bank, the Keiyo Bank, and four others. The trial also intends to test the practical aspects surrounding the system funds transfer settlement system — such as performance and security — if blockchain technology was adopted.

The trial, according to the press release, would be conducted by the Japanese Banks' Payment Clearing Network, otherwise known as "Zengin - net." Zengin would issue a currency in the form of a digital asset and when requested, it will be sent between banks, and the recipient bank will then return the digital asset to Zengin.

Fujitsu has been involved in technical blockchain development for some time. In 2017, it released a tool facilitating faster transactions for Hyperledger Fabric — the Linux Foundation’s enterprise blockchain solution. In June, it started a blockchain-based data storage system for the tokenization of traditional retail promotional strategies such as coupons and loyalty points.

In June, SBI Ripple Asia — a joint venture between Japan’s SBI Holdings and U.S. blockchain company Ripple — launched MoneyTap, a payment system in Japan based on blockchain offering "free real-time" money transfer via MoneyTap's mobile application. The application was launched by three of the country’s mid-sized lenders: SBI Net Sumishin Bank, Suruga Bank, and Resona Bank (also one of the participating banks for the Fujitsu trial).

Blockchain is being adopted by a considerable number of banks for money transfer and for cross-border payments. Some experts believe the technology will have a transformational impact on the banking industry. Param Vir Singh, Carnegie Bosch associate professor of business technologies at the Tepper School of Business at Carnegie Mellon University, Pennsylvania, said the key applications of the technology would be in space of payments, fraud reduction, know your customer, and loan processing. He also acknowledged the technology had a lot of limitations but had the potential to be integrated in the banking sector.