RBI Discusses CBDCs for Cross-Border Payments with HKMA, US Fed, and SWIFTby Fintech News Singapore December 11, 2023
The Reserve Bank of India (RBI) has initiated discussions with the Hong Kong Monetary Authority (HKMA), the US Federal Reserve, and the international payment platform SWIFT to explore the use of central bank digital currencies (CBDCs) for cross-border payments.
This engagement is part of the RBI’s effort to advance its pilot projects on a digital rupee, focusing on its potential for retail and wholesale cross-border payment applications. A working group has been established to lead these international discussions and formulate a roadmap for international remittances using CBDCs.
The collaboration aims to leverage the extensive experience of the US Federal Reserve and the HKMA in digital currency operations and SWIFT’s expertise in global payments. The substantial remittance flows between India, the United States, and Hong Kong underscore the significance of this partnership.
The RBI’s working group will build upon global advancements in CBDCs, including the US Federal Reserve’s trials with the Monetary Authority of Singapore and Hong Kong’s collaborative efforts with the People’s Bank of China on the digital yuan. Additionally, the RBI draws insights from SWIFT’s experiments in CBDC applications for cross-border payments.
This initiative represents a strategic step by the RBI to integrate CBDCs into global financial systems, enhancing the efficiency and security of cross-border transactions.