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SWIFT announced further progress on its experimental solution for interlinking central bank digital currencies (CBDCs), reporting that 18 central and commercial banks found "clear potential and value" in the API-based CBDC connector after a comprehensive review. SWIFT published the findings of the 12-week period of collaborative sandbox testing, in which almost 5,000 transactions were simulated between two different blockchain networks and with existing fiat-based payment systems. Sandbox participants included the Banque de France, the Deutsche Bundesbank, the Monetary Authority of Singapore, BNP Paribas, HSBC, Intesa Sanpaolo, NatWest, Royal Bank of Canada, SMBC, Société Générale, Standard Chartered and UBS. Over the coming months SWIFT will develop a beta version of the solution for payments that can be tested further by central banks. A second phase of sandbox testing will also be held, in which the SWIFT community can collaborate further with a focus on new use cases.

SWIFT has launched SWIFT Go, a low-value cross-border payments service that allows businesses and consumers to make direct transfers from their bank accounts. The company is using tighter service level agreements between institutions and pre-validation of data to provide end customers with a fast and predictable payments experience with upfront visibility on processing times and costs. Go is built on the high-speed rails of the SWIFT global payments interface (gpi) that increases the speed, traceability, and transparency of global fund transfers. Seven global banks, which collectively handle 33 million low-value cross-border payments per year, are already live with the service.

A joint paper from SWIFT and Accenture looks at the CBDC opportunities and challenges for international payments, sets out practical requirements for the adoption of CBDC at scale, and outlines how SWIFT can support the financial community as new solutions are developed. SWIFT is planning a host of trials over the next few months to test how its platform could interact with the cross-border use of CBDCs.

SWIFT is working with over 20 banks is to develop a service to make instanteous transactions across borders for small and medium-sized companies and consumers. Costs and processing times known upfront and real-time status updates will be available to both originator and beneficiary customers via their financial institutions. The service builds on the strength of the SWIFT Global Payment Initiative (GPI), SWIFT's response to blockchain-based RippleNet: https://www.finextra.com/blogposting/16147/swift-gpi-vs-ripple-payments.

Legacy wires (Swift) still dominate the cross-border landscape because it has the greatest reach. 68% of organizations' cross-border payments are done via Swift wire transfers. 80% of survey respondents report that some percentage of their organizations' B2B transactions made by cross-border payments are done via Swift.

SWIFT gpi Instant has gained its first live link in the UK, with customers of Lloyds Banking Group now able to remit instant cross-border payments through Lloyds via the UK Faster Payments system. The gpi Instant service works by connecting SWIFT gpi, the high-speed cross-border rails with real-time domestic infrastructure, in this case the UK's Faster Payments. It enables banks to use existing infrastructure to provide better service 24/7, with faster speeds, clarity on fees and, crucially, predictability on when an end beneficiary's account will be credited.

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) published a paper outlining how the financial transaction messaging platform is preparing to interact with the cross-border use of central bank digital currencies (CBDCs). SWIFT is teaming up with Accenture to test ways to link multiple CBDC networks, as well as CBDC and traditional currency networks, as a proof of concept.

JP Koning argues that Canada's significant reliance on the SWIFT network for both international and domestic financial transactions leaves its economy vulnerable to potential economic pressure from the United States, particularly under a future Trump administration. Unlike many other nations that use SWIFT primarily for international payments and have their own domestic systems, Canada's deep integration with SWIFT could allow the U.S. to exert influence by potentially limiting access. JP advocates for Canada to develop its own domestic financial messaging network, similar to systems already in place in countries like Iran and Russia, to ensure the continuity of internal commerce and bolster economic sovereignty against potential external threats.

Central banks face a host of complicated decisions in how to bolt on messaging capabilities to their key settlement systems. For large nations with extensive banking industries, building a proprietary domestic messaging alternative seems to be the preferred option. It also seems to be the default choice for rogue states like Russia. Another alternative is to fallback on using multiple independent networks for access, of which one is SWIFTNet, and thus mitigating exposure to SWIFT-related problems. This is the approach taken by Europe and the UK. For smaller nations that comply with the global consensus, like Canada, the calculus is different. Building an alternative communications network is likely to be costly. The risk of sanctions and censorship are negligible while the benefits of using a high-quality ubiquitous network for both domestic and foreign payments messaging are significant. Given these factors, it may be worthwhile to bear all SWIFT-related risks and adopt the Y-copy model.

"Founded in 1973 and connecting more than 11,000 financial institutions around the world, the Belgian messaging service that lets banks securely arrange financial transactions is co-owned by some 3,500 financial firms globally. Last year SWIFT hosted 42 million financial messages a day. SWIFT also partners with central banks including the Bank of England, the European Central Bank and the U.S. Federal Reserve System. Efforts to replace the inter-bank messaging platform have been mounted by crypto nerds and rogue nations alike."

SWIFT says a new round of sandbox testing has found that its central bank digital currency interlinking technology can enable financial institutions to carry out a wide range of transactions using central bank digital currency (CBDC) and other forms of digital tokens, easily incorporating them into their business practices. Over six months, SWIFT worked with 38 global institutions and over 125 sandbox users, and made more than 750 transactions, including simulated digital trade, tokenized asset and FX networks, as well as CBDCs for payments. The testing showed that SWIFT's CBDC connector has the potential to simplify and speed up trade flows, unlock growth in tokenized securities markets, and enable efficient FX settlement, while allowing financial institutions to continue to make use of their existing infrastructure.

Global payment services provider Swift has said that its new cross-border payments platform is coping with greater consumer demand for speed and transparency. Swift launched its global payments initiative, or GPI, in 2017, in an attempt to speed up cross-border payments systems.

"SWIFT says that gpi is the new standard in cross-border payments. Well, after looking straight at the facts it seems that not only it is not the standard but it is far away from being that and unless they create a whole new and open network and system (which seems impossible), it will never be. The certain thing is that the banks that are in the top of SWIFT, are afraid of Ripple and they are doing everything to stop them or slow them down."

"SWIFT will enable instant and frictionless payments from account-to-account anywhere in the world, with an end-to-end solution that combines international and domestic capabilities. This ambitious platform expansion means SWIFT will support financial institutions to strengthen their positions in B2B payments and capture new volume in SME and consumer segments."

The People's Bank of China (PBOC) announced that its joint venture with SWIFT will start offering cross-border transaction services. The Finance Gateway Information Services Company will set up a Chinese network for financial messaging services. The firm will also set up a localized data warehouse to monitor and analyse cross-border payment messaging. The Finance Gateway Information Services Company was set up in mid-January, as a joint venture between SWIFT and the China National Clearing Centre, a PBOC subsidiary. Minority shareholders include China's Cross-border Interbank Payment System (CIPS), the Payment & Clearing Association of China and the PBoC Digital Currency Research Institute.http://www.pbc.gov.cn/goutongjiaoliu/113456/113469/4212383/index.html

The People's Bank of China (PBoC) China National Clearing Center (CNCC) and its Digital Currency Research Institute (DCRI) has partnered with SWIFT to launch a new financial payment service, Finance Gateway Information Service Limited. No further details on the functions or scope of the funding were offered on the registration document. SWIFT owns 55% of the incorporation contribution, CNCC owns 34%, DCRI 3%, CNCC's subsidiary Cross-border Interbank Payments and Settlement Limited (5%), and the Clearing Association of China (3%).

SWIFT and Chainlink will be collaborating with dozens of financial institutions to test how they can use Swift's infrastructure to instruct the transfer of tokenized assets across blockchains. This builds on a series of successful trials in 2022, and also will explore how the industry could address potential operational and regulatory pitfalls facing financial institutions when operating in blockchain environment.

SWIFT has successfully shown that central bank digital currencies (CBDCs) and tokenized assets can move seamlessly on existing financial infrastructure. The findings, from two separate experiments, bridged between different distributed ledger technology (DLT) networks and existing payment systems, allowing digital currencies and assets to flow smoothly alongside, and interact with, their traditional counterparts.

Since August 2022, all required ISO 2022 cross-border payments and reporting (CBPR+) capabilities have been deployed and institutions have been able to exchange messages on an opt-in basis.  However, in October the ECB decided to delay the Eurosystem ISO 20022 migration from November 21, 2022 to March 20, 2023, to ensure greater system stability and user readiness, as well as smooth transition to new platform. Hence, an overwhelming majority of SWIFT's global community requested that SWIFT align the start of the global ISO 20022 migration for CBPR+ with the ECB's updated timetable to ease implementation.

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) published a paper outlining how the financial transaction messaging platform is preparing to interact with the cross-border use of central bank digital currencies (CBDCs). SWIFT is teaming up with Accenture to test ways to link multiple CBDC networks, as well as CBDC and traditional currency networks, as a proof of concept.