Our blueprint for a new class of platforms would enhance and ensure greater interoperability, efficiency, and safety in cross-border payments, said Tobias Adrian, director of the IMF’s Monetary and Capital Markets Department. The International Monetary Fund (IMF) has proposed a global platform for cross-border central bank digital currencies (CBDCs) that could reduce payment costs while still allowing countries to impose compliance checks and capital controls.
The new system, outlined in an IMF Fintech Note published Monday, would program payments without payees giving private information to intermediaries, and save liquidity by letting contracts be pledged as collateral. The ledger would be controlled by the platform operator, ensuring there is a unique description of who owns what, so no double spending can occur. Governments would retain the right to limit their citizens’ transactions in foreign currency and impose anti-money laundering checks.
The IMF is working hard on a global infrastructure to enable different CBDCs to work with each other, according to Managing Director Kristalina Georgieva. Crypto proponents often cite easier cross-border payments as a major benefit, but there is competition against free-floating blockchain solutions being used for that purpose. The Bank for International Settlements and private players such as SWIFT are both looking at options involving state-backed CBDCs.