Sub-Saharan Central Bankers Discuss Cross-Border CBDC – Ledger Insights

Last week, the Central Bank of Kenya hosted a meeting of the Sub-Saharan Africa advisory group of the Financial Stability Board (FSB). Several of the 13 central banks represented at the conference are working on or have launched central bank digital currencies (CBDCs). But the topic of discussion was not the domestic use of CBDC but how to take advantage of CBDC for cross-border payments. Improving the efficiency of cross-border payments is an important initiative of the FSB.

“The group discussed initiatives to improve cross-border payments in the region, including the potential use of central bank digital currencies for cross-border payments, while noting the importance of compliance with anti-money laundering and terrorist financing regulations ( AML-CFT) standards,” an FSB statement said.

However, the meeting was not called solely to discuss CBDC.

Of the countries present, the Reserve Bank of South Africa is the one that has publicly engaged in a cross-border CBDC initiative, Project Dunbar with the central banks of Singapore, Malaysia and Australia. Most of the other South African CBDC research has focused on the wholesale or interbank use of CBDCs.

Africa advances CBDC

Several of the African banks present at the meeting are advancing retail CBDC initiatives. Nigeria is active with its eNaira, Ghana selected a technology partner for its eCedi pilot program last year, Kenya held a public consultation earlier this year, and Uganda is seriously considering it.

In addition to the five nations mentioned, central banks present at the meeting included Angola, Botswana, Mauritius, Namibia, Tanzania, Zambia, the Central Bank of West African States (BCEAO) and the Bank of Central African States ( BEAC). The central banks of Burundi, South Sudan, Congo and Rwanda were also present as guests.

Meanwhile, the number of cross-border CBDC initiatives continues to expand. The MBridge project, in which the central banks of Hong Kong, Thailand, China and the United Arab Emirates participate, is the most advanced. Sweden, Norway, and Israel are exploring how a retail CBDC could be used cross-border in Project Icebreaker. Others include a project between Singapore and the New York Federal Reserve, the Mariana Project involving the central banks of France, Switzerland, and Singapore, and the Jura Project between France and Switzerland.