Enhancing domestic payments with wCBDC


Over the last 12-24 months, central banks worldwide have intensively researched digital currencies' potential to strengthen payment systems and enhance wholesale settlements' efficiency. Collaboration between central banks and institutions like the Bank for International Settlements Innovation Hub has led to a proliferation of projects, exploring issues from credit risk to interoperability.

At OMFIF's panel on enhancing domestic payments with wholesale CBDCs, participants provided insights into these projects, offering a glimpse into the future of the digital global financial marketplace. While opinions on CBDC desirability vary, panellists agreed that the development of wholesale CBDCs will be gradual, not revolutionary.

Claudine Hurman, director of innovation and financial market infrastructures at Banque de France, emphasised the gradual approach, citing central banks' mandate for financial stability. Rushing CBDC introduction could risk market disruption, echoed Philipp Müller of Swiss National Bank, stressing the importance of resilience and swift problem-solving.

Scalability and interoperability emerged as key themes. Catherine Gu from Visa highlighted efforts like Universal Payments Channels to foster interoperability. Audience members queried risks from payment providers' monopolies, reflecting concerns in the industry.

In a poll, 50% of respondents prioritised tokenisation of financial markets as a catalyst for wCBDC-driven financial innovation, aligning with the panel's views. Cross-border payments (42%), real-time gross settlement upgrades (33%) and blockchain enhancements (25%) also ranked high. Only 8% saw the introduction of systemic stablecoins introduction as significant.

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