Publication: Central Bank Digital Currencies for Cross-border Payments: A Review of Current Experiments and Ideas
Date
2021-11
ISSN
Published
2021-11
Author(s)
World Bank
Abstract
Over the years, the demand for
seamless and inexpensive cross-border payments has grown in
parallel with growth in international e-commerce,
remittances and tourism. Yet, cross-border payments have not
kept pace with the intensive modernization that has
characterized domestic payment services worldwide. An
alternative avenue to modernize delivery of cross-border
payment services is being increasingly explored in the
context of central banks issuing their own digital currency.
A central bank digital currency (CBDC) could well
incorporate options and features specifically designed to
execute cross-border payments, with a view to reducing the
inefficiencies and rents discussed above by shortening the
payments value chain. This report discusses the use of CBDCs
for cross-border payments. The report reviews the models
that have been developed for this purpose to date and
discusses critical legal issues that arise in the context of
cross-border use of CBDC. This report is organized as
follows. Section II specifically discusses the models
developed jointly by the Bank of Canada, Bank of England,
and Monetary Authority of Singapore; Section III evaluates
how cross-border CBDCs address challenges of the existing
correspondent banking arrangement; Section IV discusses the
legal issues involved in cross-border use of CBDCs, and
Section V concludes the report with some general remarks.
Citation
“World Bank. 2021. Central Bank Digital Currencies for Cross-border Payments : A Review of Current Experiments and Ideas. © World Bank, Washington, DC. http://openknowledge.worldbank.org/handle/10986/36764 License: CC BY 3.0 IGO.”