Central bank digital currencies can slash cross border payment time – BIS

imageForex7 minutes ago (Sep 28, 2021 03:01AM ET)

By Alun John

HONG KONG (Reuters) – A recent pilot scheme showed that using central bank digital currencies (CBDC) underpinned by blockchain can slash the time needed for cross border transactions from days to seconds and also cut costs, the Bank of International Settlements said.

The pilot programme explored using CBDCs to make cross border payments, the BIS said in a report published on Tuesday.

It found that payments could be made in a few seconds compared to the existing three to five days by sidestepping complicated existing arrangements under which payments are passed via a network of correspondent banks, the BIS said, and helped reduce costs by up to 50%.

Many governments and central banks around the world are exploring the use of CBDCs, which are digital forms of existing currencies.

Some, like China, are trialing retail-focused CBDCs designed to replicate cash in circulation, while others are considering using so-called wholesale CBDCs to improve the internal workings of their financial systems, or how they interact with others’.

The pilot scheme, which initially involved central bank instiutions in Hong Kong and Thailand, has since expanded to include China and the UAE’s central banks, and is operating under the auspices of the BIS.

Central bank digital currencies can slash cross border payment time – BIS

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Categories

Subscribe here

Read More

Recent