This comes as Project Meridian, a digital property settlement prototype established by BIS and the BoE in March last year, closed today with a pledge to change how property payments are carried out in the future.
Coadjute helped to develop the prototype.
The project synchronised payments using central bank money to reduce the risk of a payment not being completed or the failure to hand over the ownership of a property. This was with an aim to lessen complexity and liquidity costs through time-saving measures such as temporarily holding funds in a third-party account and releasing them on completion day.
Project Meridian digitises the workflow between commercial banks, the Bank of England and HM Land Registry. Conveyancers are able to connect to the service and send instructions to reserve funds.
The funds for the transaction or a chain or transaction are then moved in synchronisation according to a pre-arranged date and time.
The funds are moved immediately, and digital deeds are issued, with instructions sent to HM Land Registry to update the register.
Coadjute said the current process was “complicated, manual and at significant risk of fraud”. It also said payments being moved around by numerous parties often resulted in transfers not going as planned on completion day, delays in releasing the keys and fall throughs.
It said the new process would address these obstacles.
Coadjute has been working on a system to digitise property transactions for some time, and in 2021 announced it had created a stablecoin to facilitate the movement of money in digital form to make process more efficient.
At the time, the firm said this development would simplify the property transaction process.
Reimaging the settlement process
John Reynolds, project director and COO at Coadjute, said: “Settlement is particularly complex and can only be tackled through deep collaboration and partnership with the public sector. What the Bank for International Settlements (BIS) Innovation Hub London Centre has done fantastically well here is create an open, innovative and collaborative environment for the public and private sector to work together to do just that.”
Dan Salmons, CEO at Coadjute, added: “I’ve spent most of my working life leading payments innovations in banks and fintechs – I was there in the early days of contactless cards and mobile payments – so know first-hand what it looks like at the start of a genuine change to the way we all move money.
“Few payments are more important than those for property, and the work the Bank of England, HM Land Registry, Bank of International Settlements and Coadjute have done to reimagine the settlement process is extraordinary. We look forward to seeing the impact this project will have on shaping the future of property transactions.”