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November 30, 2021

On the web

Fed’s Powell Says New Innovation Hub Will Help Central Bank Improve Payments

Reuters

“The New York Federal Reserve launched a new innovation center on Monday that will support the central bank as it explores the possibility of a digital currency, assesses the financial risks associated with climate change and tackles other issues such as financial market infrastructure and regulation. The center, in partnership with the Bank for International Settlements (BIS) Innovation Hub, will help the central bank improve the current payments system, Fed Chair Jerome Powell said in remarks prepared for a virtual event on Monday.”

July 28, 2021

On the web

ECB to Overhaul Payment System After Crashes Last Year

Reuters

“The European Central Bank will overhaul its payment system as recommended in an independent review published on Wednesday to address deficiencies in its design and governance that led to a string of crashes last year. The Target system handles payments worth nearly 2 trillion euros ($2.36 billion) per day and is run by the ECB with the help of the central banks of Germany, France, Italy and Spain. Consultancy firm Deloitte carried out a review after Target ran into technical problems five times last year, in one instance leaving payments grounded for 11 hours.”

March 29, 2021

Top Post

Brazil’s Central Bank Uses Payment Platform to Spur Competition

Wall Street Journal

“Brazil’s central bank is revving up its yearslong effort to bust up the country’s clubby banking industry, using a pandemic-driven shift toward touchless payments to launch its own digital platform. The payment system, dubbed Pix, was set up and is maintained by the central bank instead of private payments players, unlike similar systems in other countries. Since its launch in November, Pix is already handling a larger share of digital payments than its private-sector alternatives, advancing the regulator’s goal of spurring competition and getting more Brazilians to use financial services. Additionally, Brazil’s central bank introduced last month so-called open banking, mandating that institutions share key pricing and credit history data with rivals. That added to recent efforts to encourage the growth of fintechs to give consumers more options and to pull unbanked Brazilians into the formal financial system.”

December 10, 2020

On the web

Central banks split on role of private sector in payments – survey

Reuters

“Central banks are split over whether to collaborate with the private sector in payments, a think-tank said on Thursday, underscoring questions over the role of finance and technology firms as they work on innovations such as digital currencies. Over half of central banks expect countries to work with the private sector in building and running payments systems, a survey by the Official Monetary and Financial Institutions Forum (OMFIF), a central banking and economic policy forum, showed. Yet three-quarters of the banks said it was the state’s job to govern such systems rather than ceding control to the private sector, the survey of 20 central banks and regulators in advanced and developing economies showed.”

November 23, 2020

On the web

August 19, 2020

On the web

RBI releases draft guidelines for the proposed digital payments self-regulatory organisation

Economic Times

“The Reserve Bank of India has released the draft guidelines for the proposed Self-Regulatory Organization (SRO) responsible for setting and enforcing internal rules for the participants in India’s burgeoning digital payment ecosystem.The proposed SRO will be expected to act as a two-way communication channel between the payments industry and the central bank. It shall also be responsible for maintaining benchmarks and standards for proper functioning among member entities, as per the draft norms released by RBI on Tuesday.”

July 31, 2020

On the web

July 21, 2020

On the web

July 14, 2020

On the web

Singapore Says Blockchain Payments Project Ready for Commercial Rollout

Reuters

“Singapore has developed a blockchain-based payments network that could enable faster and cheaper international settlements, authorities said on Monday, adding that the next step was a commercial rollout. The final phase of the years-long ‘Project Ubin’ saw the Monetary Authority of Singapore team up with state investor Temasek and J.P. Morgan to develop the prototype multi-currency payments network.”

June 25, 2020

On the web

Kenya’s Central Bank Extends Mobile Payments Relief by Six Months

Reuters

“Kenya will extend various relief measures on mobile phone payments that were introduced to help to curb the spread of the new coronavirus by a further six months, the central bank said on Wednesday. The East African country introduced the measures to encourage cashless payments on mobile phones because the government said avoiding the use of cash could help contain the spread of the virus. They included doubling of the daily transaction limits to 300,000 shillings in mid-March after the first case of COVID-19 was reported.”

June 24, 2020

On the web

Brazil Suspends WhatsApp’s New Payments System

Reuters

“Brazil’s central bank effectively suspended a newly-launched system allowing users of Facebook Inc’s WhatsApp messaging service to send money via chats, ordering Visa and Mastercard to halt payments and transfers via the system. The central bank said in a statement that rolling out the service without previous analysis by the monetary authority could damage the Brazilian payments system in the areas of competition, efficiency and data privacy.”

June 18, 2020

On the wires

Federal Reserve Announces the FraudClassifier℠ Model to Help Organizations Classify Fraud Involving Payments

“The Federal Reserve today published the FraudClassifier model – a set of tools and materials to help provide a consistent way to classify and better understand the magnitude of fraudulent activity and how it occurs across the payments industry. The model was developed by the Fraud Definitions Work Group, which was comprised of Federal Reserve and payments industry fraud experts.”

The Bank of Thailand Announces the Prototype Development Project of Central Bank Digital Currency (CBDC)

“The Bank of Thailand (BOT) has announced the project to develop the prototype of the payment system for businesses using Central Bank Digital Currency (CBDC), which will build upon knowledge from Project Inthanon. The project scope will include conducting a feasibility study and developing a process to integrate CBDC with the business’ innovative platform. The BOT recognizes and supports the important roles of financial innovation and technology in enhancing the competitiveness and readiness of the business sector entering the digital age. The project marks an important step in broadening CBDC’s scope and adoption to wider audiences, starting with large corporates.”

June 8, 2020

On the web

Reserve Bank Sets up a Rs.500 Crore Digital Payments Infra Fund

The Economic Times

The Reserve Bank of India on Friday announced that it has setup a Rs.500 crore Payment Infrastructure Development Fund (PIFD) to support and improve the development of digital payments ecosystem in the rural and north east districts of the country. The central bank has made an initial seed contribution of Rs.250 crore to the PIFD with the other half of the fund expected to be contributed by all card issuing banks and network operators, the central bank said.

June 4, 2020

On the web

Singapore to Assess COVID-19 Impact on Digital Bank Bidders

Reuters

“Bidders for five Singapore digital bank licences on offer will have to factor in how the COVID-19 outbreak has impacted their funding and profitability plans, as the central bank kicks off interviews with applicants over the next few weeks, three sources aware of the matter said. Singapore has drawn interest from 21 applicants seeking to shake up its banking landscape in what would be its biggest liberalisation in two decades.”

June 3, 2020

On the web

Australia Central Bank May Use Powers to Lower E-payment Costs

Reuters

“Australia’s central bank could use its regulatory powers to reduce the cost of electronic payments for merchants and consumers as the coronavirus pandemic makes people wary of using cash, Assistant Governor Michele Bullock said on Wednesday. The Reserve Bank of Australia (RBA) is conducting a review of retail payments regulation in the country with a focus on the cost and resilience of electronic payments and access to cash.”

May 6, 2020

On the web

Google and Gates Foundation Join Forces to Promote Digital Payments in the Developing World

Fortune

“A coalition of nonprofits and tech companies including Google and the Bill and Melinda Gates Foundation want to [make] it easier for developing countries to build real-time digital payments systems. On Wednesday, they announced the formation of the Mojaloop Foundation, which will develop and promote a free, open-source real-time payments platform intended for nations and central banks. The Mojaloop Foundation’s founding sponsors also include the Rockefeller Foundation, the philanthropy and investing group Omidyar Network, and the financial technology startups Coil and ModusBox.”

April 27, 2020

On the wires

Federal Reserve Board Announces Interim Final Rule to Delete the Six-per-month Limit on Convenient Transfers From the “Savings Deposit” Definition in Regulation D

“The Federal Reserve Board on Friday announced an interim final rule to amend Regulation D (Reserve Requirements of Depository Institutions) to delete the six-per-month limit on convenient transfers from the “savings deposit” definition. The interim final rule allows depository institutions immediately to suspend enforcement of the six transfer limit and to allow their customers to make an unlimited number of convenient transfers and withdrawals from their savings deposits at a time when financial events associated with the coronavirus pandemic have made such access more urgent.”

April 22, 2020

On the web

Argentina’s Central Bank Trials Blockchain for New Interbank Settlement Layer

CoinDesk

“The Central Bank of Argentina (BCRA) is testing a new blockchain-powered clearing system that could be used by some of the country’s largest financial institutions. Blockchain developer IOV Labs said Tuesday it had created a proof-of-concept, for a permissioned blockchain network, based on RSK Smart Contract Network , in conjunction with the central bank and major commercial banks in Argentina including Santander and BBVA. The solution is aimed speed fiat payments, make them more reliable and introduce end-to-end traceability, IOV said. Network participants will include the BCRA, banks, clearinghouses and other financial entities. While currently in the testing phase, IOV and BCRA said the new network could form the basis for an alternative clearing system.”

March 25, 2019

On the web

Central Banks See ‘No Value’ in Issuing Digital Currency: BIS Chief

CoinDesk

“The general manager of the Bank for International Settlements (BIS) has again warned that caution is needed when considering central bank digital currencies. In a speech at the Central Bank of Ireland on Friday, Agustin Carstens said that central banks today “are not seeing the value” of venturing into the unknown when it comes to issuing a central bank digital currency (CBDC), as such a move could bring fundamental changes to both financial stability and the monetary system. The current monetary system, he explained, consists of two tiers – the customer-facing banking system and the central bank – which both work together. However, with a CBDC, the deposit and lending business would shift from commercial banks to central banks, producing a one-tier system”

July 30, 2018

On the web

Mexico Central Bank Tightens Rules On Electronic Transfers

BNamericas

“Mexico’s central bank on Friday tightened requirements for participants in the country’s electronic interbank payment system (SPEI), following a wave of coordinated attacks that manipulated the system earlier in the year was made public. Those attacks, coordinated between hackers and client accomplices, cost banks an estimated 300mn pesos (US$16mn). Still under investigation, the incidents put pressure on authorities to quickly act to close vulnerabilities.”

June 12, 2018

On the web

Central Banks Should Consider Offering Accounts To Everyone

The Economist

“Some central banks are considering whether and how to expand the use of their own digital money. Sweden’s Riksbank, for example, is exploring ways to create a widely used e-krona. In June Swiss voters will participate in a referendum on a radical monetary reform, one effect of which would be to give individuals access to digital money at the Swiss National Bank (SNB). The main difficulty central banks face is how to facilitate the circulation of digital currency without routing everything through banks, as happens today.”

March 28, 2018

On the wires