BIS completes CBDC cross-border payments pilot 26 October 2022Switzerland Reporter: Bob Currie
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The Bank for International Settlements (BIS) has completed a pilot with four central banks as part of its Project mBridge initiative that aims to deliver cross-border payments between commercial banks using central bank digital currencies (CBDCs).
The project forms part of G20-led initiatives to experiment with new technology to deliver faster, safer and more cost efficient settlement and payments transactions.
By enabling peer-to-peer and instant exchange of multiple CBDCs on a single network, Project mBridge sets out to resolve deeply-rooted inefficiencies in cross-border payments and to encourage greater financial inclusion and innovation in global payments.
The BIS Innovation Hub in Hong Kong has worked with the Hong Kong Monetary Authority (HKMA), the Bank of Thailand, the Digital Currency Institute of the People’s Bank of China and the Central Bank of the United Arab Emirates on the pilot project, which has enabled 20 commercial banks in these jurisdictions to use CBDCs to complete more than 160 payments and foreign exchange transactions with combined value of more than US$22 million.
Cecilia Skingskley, head of the BIS Innovation Hub, says: “Financial exclusion is not just a problem for individuals; it is also affecting economies. This project makes important strides towards developing a platform that has the potential to foster more inclusive and efficient payments systems that will benefit those making and receiving payments in different countries and jurisdictions as well as the overall functioning of the global financial system.”
The BIS is continuing its work to establish user requirements, technical and governance specifications necessary to promote interoperable CBDCs.
This includes Project Genesis 2.0, the BIS programme to confirm the technical feasibility of tokenised green bonds linked to carbon forwards, which is a collaboration between the BIS Innovation Hub’s Hong Kong Centre, the HKMA and the UN Climate Change Global Innovation Hub, along with a number of private sector partners.
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