SWIFT & Capgemini unite to address CBDC challenges

SWIFT is collaborating with Capgemini to explore the interlinking of Central Bank Digital Currencies (CBDCs).

SWIFT, the global payments infrastructure network, concluded a first set of CBDC experiments in 2021 which demonstrated they could successfully conduct a cross-border transaction between one entity on a DLT-based CBDC network and a second operating on a real-time gross settlement (RTGS) system.

Working with Capgemini, SWIFT is now testing how multiple domestic CBDC networks can be linked with those emerging worldwide to make cross-border payments more seamless and frictionless.

Thomas Zschach, chief innovation officer at SWIFT, said: “Facilitating interoperability and interlinking between different CBDCs being developed around the world will be critical if we are to fully realise their potential.

“Today, the global CBDC ecosystem risks becoming fragmented with numerous central banks developing their own digital currencies based on different technologies, standards and protocols.”

Sudhir Pai, chief innovation officer of financial services at Capgemini, added: “Navigating decentralisation is complex with many technology choices, operating models, and policy considerations. Our well-defined taxonomy has helped us accelerate our efforts to build CBDC interlinks with SWIFT.”

Beyond testing interlinking CBDCs, SWIFT has stated that its collaboration with Capgemini is also about how SWIFT can interlink, at a network level, CBDC platforms regardless of technology, with existing payments systems, via the SWIFT platform.

Rishabh Shah, head of capability development for DeFi at Capgemini, said: “We are combining our deep expertise in payments with significant investments in several CBDC-related innovations. This collaborative effort with SWIFT aims to remove entry barriers for all participants around the globe where CBDCs coexist with traditional payment rails.”

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