Cryptocurrency payment rival? "Cross-border fast payment system" to be interconnected by 2027, supported by G20 and BIS

The Bank for International Settlements (BIS) released a report to the G20 in October, providing solutions for regulating cross-border fast payment systems. The G20 aims to achieve cross-border retail payments and remittances based on interconnected fast payment systems by 2027.

The Federal Reserve's instant payment system, FedNow, has been officially launched, with 57 participants such as New York Mellon starting to provide services.

Regulating "Cross-Border Fast Payment System," G20 to Achieve by 2027

The Bank for International Settlements (BIS) stated that interlinking arrangements among Fast Payment Systems (FPS) are a promising solution to enhance cross-border payments.

Interlinking arrangements of FPS allow Payment Service Providers (PSPs) from different jurisdictions to transact as if they were in the same system, making payments faster, cheaper, more user-friendly, transparent, and available 24/7. The G20 has identified the governance and supervision of interconnected cross-border payment systems, especially FPS, as a priority to achieve the 2027 cross-border payment goals.

G20: Interconnected FPS Facilitate Cross-Border Retail Payments and Remittances

The Committee on Payments and Market Infrastructures (CPMI) of the Bank for International Settlements (BIS) plans to submit a final report by the end of 2024. This interim report serves as an update on their involvement thus far.

The BIS stated that interlinking arrangements are a promising solution to enhance cross-border payments, but they are still relatively underutilized. The G20 has recognized the potential of FPS interconnection in achieving the 2027 cross-border retail payments and remittances goals.

Global FPS Flourishing, Facilitating Interlinking Arrangements

The Bank for International Settlements (BIS) mentioned that with the rapid growth of global FPS and a greater trend towards interoperability, the opportunities for FPS interconnection have increased.

The G20 has outlined specific actions for 2023-2024, including finalizing the blueprint for "Project Nexus," showcasing interlinking arrangements, and drafting an interim report on the governance and supervision considerations for FPS interconnection.