Saudi Central Bank Joins International Consortium to Develop Cross-Border Payments Infrastructure with Wholesale CBDC
The Saudi Central Bank (SAMA) has announced its participation in the Bank for International Settlements' mBridge project, which is a multi-central bank digital currency system (Wholesale CBDC) aimed at facilitating cross-border payments between commercial banks in different jurisdictions.
This is considered the first multi-central bank digital currency platform to reach the Minimum Viable Product phase of development.
The G20, during Saudi Arabia's presidency in October 2020, agreed on a roadmap to enhance global cross-border payments, with a goal of making transactions cheaper, faster, more inclusive, and more transparent.
The text discusses a roadmap for evaluating central bank digital currencies (CBDCs) for cross-border payments, specifically through a project called mBridge.
SAMA is investigating the feasibility of wholesale CBDCs to improve cross-border payment effectiveness.
mBridge is a collaboration between the BIS Innovation Hub, Bank of Thailand, Central Bank of UAE, People's Bank of China's Digital Currency Institute, and Hong Kong Monetary Authority, aiming to address high costs, low speed, and operational complexities in cross-border payments.
The text discusses the potential benefits of multi-Central Bank Digital Currency (CBDC) arrangements for improving the current cross-border payment system.
This system has faced challenges in jurisdictions where correspondent banking has retreated, leading to increased costs and delays.
Multi-CBDC arrangements would allow different jurisdictions to connect within a single common technical infrastructure, enabling immediate, cheap, and universally accessible cross-border payments with final settlement.
This could address financial inclusion concerns and improve the efficiency of the global financial system.
The G20, during Saudi Arabia's presidency in October 2020, agreed on a roadmap to enhance global cross-border payments, with a goal of making transactions cheaper, faster, more inclusive, and more transparent.
The text discusses a roadmap for evaluating central bank digital currencies (CBDCs) for cross-border payments, specifically through a project called mBridge.
SAMA is investigating the feasibility of wholesale CBDCs to improve cross-border payment effectiveness.
mBridge is a collaboration between the BIS Innovation Hub, Bank of Thailand, Central Bank of UAE, People's Bank of China's Digital Currency Institute, and Hong Kong Monetary Authority, aiming to address high costs, low speed, and operational complexities in cross-border payments.
The text discusses the potential benefits of multi-Central Bank Digital Currency (CBDC) arrangements for improving the current cross-border payment system.
This system has faced challenges in jurisdictions where correspondent banking has retreated, leading to increased costs and delays.
Multi-CBDC arrangements would allow different jurisdictions to connect within a single common technical infrastructure, enabling immediate, cheap, and universally accessible cross-border payments with final settlement.
This could address financial inclusion concerns and improve the efficiency of the global financial system.
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