IMF, World Bank, and BIS Recommend Countries on CBDCs to Work Together to Improve Cross-Border Payments – Regulating Bitcoin News

The International Monetary Fund (IMF), the World Bank and the Bank for International Settlements (BIS) have carried out a comprehensive study on the use of central bank digital currencies (CBDCs) for cross-border payments. Their report to the G20 states that improved cross-border payments “can be achieved … as long as countries work together”.

  • The Committee on Payments and Market Infrastructures, the BIS Innovation Hub, the International Monetary Fund and the World Bank published a joint report to the G20 on July 9, entitled “The Central Bank’s Digital Currencies for Cross-Border Payments”.
  • The report states: “Cross-border payments are often criticized for their high costs, their slow speed, their limited access and their insufficient transparency.” To meet these challenges, the G20 countries adopted a roadmap in October last year. It was developed by the Financial Stability Board (FSB) and other relevant standardization bodies.
  • Various aspects of central bank digital currencies (CBDCs) were analyzed in the report. This includes domestic and potential designs, current central bank considerations regarding cross-border CBDC usage, and the potential benefits and risks of using CBDCs for cross-border payments.
  • Improved cross-border payments “can be achieved through varying degrees of integration and cooperation,” the report says. “The analysis underlines both the need for multilateral cooperation on macro-financial consequences and the importance of interoperability between CBDCs.”

  • According to the main conclusion of the joint report:

Central bank digital currencies (CBDCs) have the potential to improve the efficiency of cross-border payments as long as countries work together.

  • Many central banks are currently investigating the risks, benefits, and various designs of CBDCs, the report said, noting that no major jurisdiction has yet implemented a CBDC and many design and policy decisions remain unresolved. Some central banks are already in the test phase, such as China. The full joint report can be found here.

Do you think countries should work together to use CBDCs for cross-border payments? Let us know in the comment section below.

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