Bank Indonesia

07/01/2024 | News release | Distributed by Public on 07/02/2024 05:51

Project Nexus Completes Comprehensive Blueprint for Connecting Domestic Instant Payment Systems Globally and Prepares for Work Towards Live Implementation

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JOINT PRESS RELEASE

No. 26/131/DKom

  • ​Nexus is a BIS Innovation Hub project that seeks to enhance cross-border payments by connecting multiple domestic instant payment systems (IPS) globally.
  • BIS will facilitate central banks and IPS operators of India, Malaysia, the Philippines, Singapore and Thailand as they work towards live implementation in the next phase, with Indonesia as special observer.
  • It is the first BIS Innovation Hub project in the payments area to move towards live implementation. BIS to play advisory role as Project Nexus sets up operational scheme and opens to potential new participants across the globe.

Bank Indonesia, The Bank for International Settlements (BIS) and partners today announced that they have completed the comprehensive blueprint for Phase 3 of Project Nexus, which will allow ready participants to work towards the next stage of seamlessly connecting their IPSs.

Phase 4 will see the Bank Negara Malaysia, Bangko Sentral ng Pilipinas, Monetary Authority of Singapore, the Bank of Thailand and domestic IPS operators - who worked together in Phase 3 - joined by Reserve Bank of India, expanding the potential user base to India's Unified Payments Interface (UPI), the world's largest IPS.

Bank Indonesia (BI) will continue its association with the project with special observer status. BI took part in Phase 3 and it will continue in this capacity to observe/follow the project in the next stage of its development.

Nexus is designed to standardise the way domestic IPSs connect to one another. Rather than an IPS operator building custom connections for every new country that it connects to, the operator only needs to make one connection to Nexus. This single connection would allow the IPS to reach all other countries in the network.

"I wish our partners in Nexus every success as they advance the project from concept to reality. This is the first BIS Innovation Hub project that central banks are moving towards a live phase together with instant payment providers. When implemented, it will greatly enhance cross-border payments in line with both the G20 cross-border payments programme and our mission to develop public goods in the technology space to support central banks and improve the functioning of the financial system.

"Even with just the first wave of connected countries, Nexus has the potential to connect a market of 1.7 billion people globally, allowing them to make instant payments to each other easily and cheaply."

- BIS General Manager Agustín Carstens

Governor Perry Warjiyo of Bank Indonesia emphasize that Nexus's purpose is to achieve interoperable cross-border payments rooted in a strong policy framework, inclusivity, and effective risk management. This vision aligns with broader public policy objectives and aims to provide efficient and affordable cross-border payment solutions to individuals and businesses worldwide, thereby enhancing global economic participation. By prioritizing those principles, the goal is to enhance a seamless and secure cross-border payment system that promotes economic growth, financial inclusion, and sustainable development.

The conclusions and lessons of Phase 3 of Nexus are described in a report [LINK: https://www.bis.org/publ/othp86.htm​] published today. This is complemented by a detailed scheme rulebook and technical implementation guides, as well as ISO 20022 message specifications, which are available to central banks on request.

To facilitate live implementation, the partner central banks and IPS operators have agreed to work towards establishing a new entity, the Nexus Scheme Organisation (NSO), which will be responsible for managing the Nexus scheme, and continuing the mission to achieve instant cross-border payments at scale.

The NSO will be wholly owned by the participating countries. In developing the blueprint in Phase 3 of Nexus, the BIS has fulfilled its role of supporting central banks in finding innovative solutions to deliver public goods and one of its key commitments as part of the G20 Roadmap for Enhancing Cross-border Payments.

While the BIS will not own or operate the NSO, it will continue its support by playing a technical advisory role as participating countries work towards taking Nexus live. It will also facilitate co-operation among members and the entry of new participants, helping realise Nexus' global ambition.

1 July 2024​