BIS Innovation Hub: Enhancing Cross-Border Payments and the Promise of Multi-CBDC Platforms

Posted on Nov 22, 2022 by Daniel Eidan, Advisor, Solution Architect, and Leanne (Si Ying) Zhang, Advisor, Bank for International Settlements Innovation Hub Hong Kong Centre*


Today’s cross-border payments are limited by high costs, low speed, a lack of transparency, operational complexities and limited access. To make things worse, all this is happening while global correspondent banking networks and services are declining.[1] Resolving these shortcomings should enable immediate, cheap and universally accessible payments that are settled in a secure medium.[2] In this context, central bank digital currencies (CBDCs) may hold significant potential. Indeed, nine out of ten central banks around the world are exploring various applications of CBDCs, with cross-border payments efficiency among their key drivers.[3] Notably, a platform upon which multiple central banks can directly issue and trade/ exchange their CBDCs can enhance and diversify cross-border payments.

CBDC and the BIS Innovation Hub

CBDCs are a digital representation of a central bank liability that may be accessible to a wider set of economic participants. They differ from the two most common forms of central bank money – cash and reserves. Cash is universally accessible but only in physical form; central bank reserves are digital but only accessible to a limited set of financial entities. Similar to traditional money, CBDCs are denominated in an existing unit of account, and serve as both a medium of exchange and a store of value.[4] Unlike it, CBDCs offer potential enhancements underpinned by novel technological implementations.


With a mandate of developing public goods in the technology space geared towards improving the functioning of the global financial system, the BIS Innovation Hub is well placed to build solutions leveraging central bank money to tackle the inefficiencies of today’s cross-border payments. The BIS Innovation Hub is an active contributor to CBDC work through applied research and development and experimentation of CBDC platforms in collaboration with central banks from a wide range of jurisdictions. Focusing on the wholesale cross-border space, the BIS Innovation Hub has run three mCBDC cross-border experiments covering different jurisdictions with different technology architecture choices – Projects Jura, Dunbar and mBridge.

The most recent mCBDC project – mBridge – is a joint initiative between the Hub’s Hong Kong Centre, and four participating central banks in Asia and the Middle East – the Hong Kong Monetary Authority, the Bank of Thailand, the Central Bank of the United Arab Emirates and the Digital Currency Institute of the People’s Bank of China.

The platform is built on blockchain technology. After experimenting with different technology architectures in earlier phases, the project team developed a new native blockchain, the mBridge ledger, to meet the needs of ... 

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[1] See Rice, T, G von Peter and C Boar (2020): “On the global retreat of correspondent banks”, BIS Quarterly Review, March.

[2] See Bindseil, U and G Pantelopoulos (2021): “Towards the holy grail of cross-border payments”, European Central Bank Working Paper Series, no 2693, August.

[3] See Kosse, A and Mattei, I (2022): “Gaining momentum – Results of the 2021 BIS survey on central bank digital currencies”, BIS Papers, May.

[4] See Committee on Payments and Market Infrastructures (2018): Central bank digital currencies, March.

*Daniel Eidan and Leanne (Si Ying) Zhang are advisors in the BIS Innovation Hub. Views expressed in the article are those of the authors, not of the Bank for International Settlements.