ECB explores solutions to meet cross border payment challenges
Wednesday 3rd August 2022
The European Central Bank (ECB) has published a paper exploring the current inefficiencies of cross border payments, suggesting possible solutions through crypto, blockchain, or interlinked national payment rails.
The paper called Towards the holy grail of cross-border payments looks at one of the biggest obstacles in addressing payment challenges, which is the friction of anti-money laundering (AML) processes.
A central bank digital currency (CBDC) could be the “holy grail” for cross-border payments, offering a solution that is immediate, cheap, universal in terms of reach, and settled in a secure settlement medium,” the European Central Bank (ECB) said in the report.
The ECB paper indicated that Bitcoin was a topic that made it to the G20 list of potential solutions. According to the Paypers.
The Bank for International Settlements (BIS) wrote to the G20 in its July report suggesting that CBDCs could be a key component in facilitating cross-border payments but said it’s “not a silver bullet,” PYMNTS reported.