SWIFT partners with Capgemini to test cross-border CBDC interoperability

SWIFT, the bank messaging service acronym for Society for Worldwide Interbank Financial Telecommunication, is set to test the interoperability of a Central Bank of Digital Currency (CBDC) by interconnecting multiple CBDC networks to execute cross-border payments. In addition to currently connecting financial institutions around the world to communicate and execute financial payments, the Belgium-based member-owned cooperative has approached digital services provider Capgemini to help it carry out its experiments. While there aren’t many CBDCs for SWIFT to use yet, nine countries have so far used CBDCs with China’s digital yuan (e-CNY) being the most widely used digital currency. .

One official blog post Published on 19 May it suggests that using CBDCs for cross-border payment solutions may have been a blind spot for the original idea of ​​the digital currency as the primary focus in its development was to address issues in line with domestic policies. Was. However, Thomas Zschach, SWIFT’s Chief Innovation Officer, expressed that the newly segregated CBDC network should work together to enable “frictionless” transfers across borders, and SWIFT will play an important role.

,capgemini and SWIFT are working together to develop a proof of concept to connect various CBDC networks with other traditional currency networks. Globally, as most central banks are creating CBDCs, ‘many banks are using different technologies, standards and protocols for their digital currencies,’ Zasch said.

As mentioned in the company’s statement, the company will develop a gateway that will intercept, translate and send domestic CBDC Transactions to SWIFT for forward transmission. It will depend on the existing Swift protocol, authentication model and infrastructure. There are over 11000 financial institutions connected through SWIFT within 200 countries.

The new alliance is a continuation of the efforts Swift launched with Accenture last year. As a result of that collaboration, the CBDC network and RTGS system were able to conduct cross-border transactions.

The experiments will demonstrate that SWIFT has the capability and technical components to connect different networks if they are successful.

“This will help CBDCs solve a major industry problem,” said Nick Kerrigan, SWIFT’s Head of Innovation. We can also help central banks build their own CBDC networks to enable cross-border payments. “


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