The Saudi Central Bank (SAMA) has partnered with international financial institutions and central banks to develop an innovative cross-border payments infrastructure. On Wednesday, SAMA announced its participation in the Bank for International Settlements’ (BIS) mBridge project, joining the Minimum Viable Product (MVP) platform. This multi-central bank digital currency (multi-wCBDC) system aims to facilitate cross-border payments between commercial banks in different jurisdictions and is the first platform of its kind to reach the MVP development phase. In October 2020, under Saudi Arabia’s presidency, the G20 agreed on a roadmap to enhance global cross-border payments for more efficient, inclusive, and transparent transactions.
SAMA’s involvement includes investigating the potential of wholesale CBDC to improve cross-border payment and settlement efficiency between commercial banks. This effort is part of a broader collaboration since 2021, involving the BIS Innovation Hub, Bank of Thailand, Central Bank of the UAE, Digital Currency Institute of the People’s Bank of China, and Hong Kong Monetary Authority. The mBridge project aims to address key inefficiencies in cross-border payments, such as high costs, low speed, and operational complexities, while also enhancing financial inclusion. Multi-CBDC arrangements offer significant potential to improve the current system, making cross-border payments immediate, cost-effective, and universally accessible with final settlement.