President of SWIFT China: CBDC can play an important role in cross-border payment

According to reports, Yang Wen, president of Swift China, said in an interview that CBDC was regarded as the next generation currency with great potential in cross-border transactions. CBDC can play an important role in the field of cross-border payment, but if it is to give full play to its potential, the interaction between different CBDC systems and existing non-CBDC payment infrastructure is crucial. To give full play to the potential of CBDC in cross-border transactions, the collaboration of the global financial community is another key element. The market needs an environment that allows all parties of the financial community to participate, test and cooperate with customers in an open and innovative way. To this end, Swift built a CBDC sandbox and visual interface. It is reported that 18 institutions around the world, including central banks, market infrastructure and commercial banks, are using the sandbox to evaluate potential use cases and broader CBDC interactivity.

Interpretation of this information:

The message reports on the potential of CBDC in cross-border transactions according to Yang Wen, the president of Swift China. Wen highlights the importance of CBDC’s interaction with existing non-CBDC payment infrastructure for it to fully realize its potential in cross-border payments. Additionally, Wen argues that collaboration among the global financial community is essential for the success of CBDC. Swift has built a CBDC sandbox and visual interface, which 18 institutions, including central banks, market infrastructure, and commercial banks, are using for evaluating potential use cases and broader CBDC interactivity.

The adoption of CBDC has been a hot topic in the financial industry in recent years. CBDCs, digital versions of traditional currencies, have the potential to bring benefits such as increased efficiency and reduced costs in cross-border transactions. However, as Wen notes, for CBDCs to be successful in cross-border payments, collaboration among different CBDC systems and existing non-CBDC payment infrastructure is necessary. This highlights the importance of creating an open and innovative environment that enables all parties of the financial community to participate, test and cooperate.

Swift’s CBDC sandbox and visual interface provide a platform for institutions to evaluate and test different CBDC use cases. This sandbox is not only useful for central banks but also market infrastructure and commercial banks. Through this open and collaborative approach, Swift is working to create an environment that fosters innovation and experimentation in the use of CBDCs.

In summary, the message highlights the importance of CBDC’s interaction with existing non-CBDC payment infrastructure, collaboration among the global financial community and the creation of an open and innovative environment. These elements are crucial for the successful adoption of CBDC in cross-border transactions.