SWIFT or Society for Worldwide Interbank Financial Telecommunication, represents the messaging and protocol network for banking and payments interconnection. The latter announces that he is working to connect different CBDC networks or central bank digital currency. The company collaborates with Capgemini, a digital service provider. A series of experiments are carried out to ensure the interoperability of CBDCs for cross-border payments and funds transfers.
SWIFT embarks on the modernization of connection systems
First, SWIFT is striving to provide its services to the upcoming group of CBDC central bank digital currencies. Right now he is experimenting with decentralized platforms. The goal is to ensure the availability of these currencies for users in the future. Especially for cross-border payments and remittances. For SWIFT, the interconnection of this new type of currency is proving to be a key element of its success. Although the number of CBDCs remains low, nine out of ten central banks are working on CBDCs. This shows great interest in the subject.
Nick Kerigan, Head of Innovation at SWIFT, emphasized the importance of this interconnection, saying: “Fostering the interconnection between the different systems and the different CBDCs is essential in order to exploit their potential. This provides the ability for businesses and consumers to make frictionless cross-border payments using CBDCs. »
According to Kerigan, CBDCs are becoming more “ fiat “. They will be considered a new form of money. At the same time, the number of platforms developed simultaneously with the traditional payment system to adapt to the traditional financial institution will increase.
SWIFT collaborates with Capgemini to experiment with CBDC cross-border payments
SWIFT is conducting experiments in partnership with Capgemini, a digital services company. These aim to test the ability of these new currencies to be exchanged. Knowing that the systems do not perform such functions. The partnership aims to develop an innovative solution facilitating the possibility of cross-border payments by any CBDC network.
Although the internal functioning of the system in place has not been revealed to the public, SWIFT specifies that part of the existing payment infrastructure is used. This includes banking messaging standards, existing authentication models, ISO 20022 as well as SWIFT’s private key infrastructure.
Conclusion
So far, experiments that use various decentralized ledger platforms, like Corda and Quorum, show the possibility of achieving the objectives set. Which would mean that CBDCs could coexist with traditional fiat currencies. This, using SWIFT systems, in a phase of transition to total digitization. Additionally, SWIFT states that experiments are progressing and results will emerge.. SWIFT announcesand also the possibility of integrating other types of crypto assets into its network, depending on global regulations.
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Emile Stantina
Interested in investment and financial markets after a business school in Chambéry, the passion for cryptocurrencies was obvious. The blockchain is surely the universal tool of tomorrow.
