Crypto news

SWIFT will check CBDC compatibility for cross-border payments

SWIFT, the operator of the international interbank information transfer system, will test the interoperability of different CBDC platforms for cross-border payments.

“Ensuring interoperability and interconnectivity between the various CBDCs being developed around the world will be critical to realizing their potential. Today, the global CBDC ecosystem risks becoming fragmented as central banks develop their own digital currencies based on different technologies, standards and protocols,” said SWIFT Chief Innovation Officer Thomas Chah.

In 2021, the company conducted a series of successful experiments on the interoperability of CBDC with existing payment systems based on the exchange of messages between banks.

In a new phase, SWIFT is partnering with consulting firm Capgemini. The partners will test the ability to link CBDC platforms, regardless of their technology, with each other and with existing systems at the network level.

In the experiments, the companies are creating a gateway that intercepts cross-border transactions and sends them to the SWIFT platform for onward transmission to the traditional payment structure or another CBDC network.

“If the experiments are successful, it would demonstrate that SWIFT has the capabilities and technical components to connect different networks. It would help solve a huge technological and industry problem facing CBDC. And it would allow us to help central banks prepare their own digital currency networks for cross-border payments,” said SWIFT head of innovation Nick Kerrigan.

The company said it was “well advanced” in the tests. SWIFT will publish a report on the work in the near future.

Related Posts

Leave a Reply

Your email address will not be published.