BIS Innovation Hub’s cross-border payments project enters live phase

A Bank for International Settlements (BIS) Innovation Hub project is to move towards live implementation, connecting several domestic instant payment systems (IPS) in Asia to enhance cross-border payments.

With phase three of Project Nexus completed, phase four will see Bank Negara Malaysia, Bangko Sentral ng Pilipinas, the Monetary Authority of Singapore, the Bank of Thailand and those countries’ respective domestic IPS operators continue to work together.

Bank of Indonesia will continue its association with the project as “special observer”, having taken part in phase three.

The central banks and IPS operators of Malaysia, the Philippines, Singapore and Thailand will be joined by the Reserve Bank of India in phase four, to expand the potential user base to India’s Unified Payments Interface (UPI), which is the world’s largest IPS.

Project Nexus is the first BIS Innovation Hub payments-related project to move from concept, to live implementation, with BIS to play an advisory role as Project Nexus sets up an operational scheme and opens to potential new participants globally.

The Nexus Scheme Organisation (NSO) will be responsible for managing the Nexus scheme, and continuing what the BIS described as its “mission to achieve instant cross-border payments at scale”.

The NSO will be wholly owned by the central banks and/or IPS in participating countries.

Agustín Carstens, general manager of the BIS, said: “I wish our partners in Nexus every success as they advance the project from concept to reality. This is the first BIS Innovation Hub project that central banks are moving towards a live phase together with instant payment providers.

“When implemented, it will greatly enhance cross-border payments in line with both the G20 cross-border payments programme and our mission to develop public goods in the technology space to support central banks and improve the functioning of the financial system.”

Carstens add that, in the first wave of connected countries alone, Project Nexus has the potential to connect a market of 1.7 billion people globally, “allowing them to make instant payments to each other easily and cheaply”.

Nexus has been designed to standardise the way domestic instant payment systems connect to one another, removing the need for the systems operator to build custom connections for every new country.

In June, BIS and the Bank of Canada launched the BIS Toronto Innovation Centre, which is the first BIS Innovation Hub Centre to be established in the Americas and the seventh to be opened by the BIS in collaboration with partner central banks around the world.

Maha El Dimachki, Singapore centre head at the BIS Innovation Hub, will be delivering a keynote on Day Two of Open Banking Expo UK & Europe 2024. View the agenda and get your ticket here.