Interconnecting Payment Schemes

Mojaloop, as a single deployment, is intended to be used to operate one (or more) payment schemes, operating on a single platform. Of course, it is quite common for a country to host multiple payment schemes, built around differing requirements for different sectors.

Ultimately, though, as a payment scheme grows, then the need to be interconnected or interoperable with other payment schemes in a country grows. Mojaloop accommodates this, through a mechanism we call "Interscheme".

Mojaloop's Interscheme approach uses a specialised type of DFSP Participant, which we call a Proxy. A Proxy is a lightweight DFSP that exists in both interconnecting schemes, and has the following characteristics:

• The Proxy does no message processing; all it does is pass messages (transactions) between the connected schemes;

• Ensuring non-repudiation across schemes means that the proxy is not involved in the agreement of terms, which helps reduce costs;

• It plays no part in the clearing of transactions.

The consequence of this is that a Proxy preserves the three phases of a Mojaloop transfer, as well as ensuring end-to-end non-repudiation. Consequently, the agreement reached during a transfer remains between the originating and receiving DFSPs, whichever scheme they are connected to.

Simple Interscheme Connection

Further, the Mojaloop scheme interconnection model supports cross-scheme discovery; in other words, an alias used in one scheme can be used to route a payment from another.

The current version of Mojaloop only supports the interconnection of Mojaloop-based schemes. Work continues to extend this to support other payment schemes, connected to a Mojaloop-based scheme.

Further details of the implementation of this scheme interconnection capability can be found in the interscheme documentation.

The following pages will be of interest to those who wish to review how interscheme capabilities relate to foreign exchange and cross border transactions.