Project Nexus completes comprehensive blueprint for connecting domestic instant payment systems globally and prepares for work towards live implementation

• Nexus is a BIS Innovation Hub project that seeks to enhance cross-border payments by connecting multiple domestic instant payment systems (IPS) globally.
• 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.
• 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 Bank of Indonesia as special observer.

Singapore, 1 July 2024… The Bank for International Settlements (BIS) and partners today announced that they have completed the comprehensive blueprint for phase three of Project Nexus, which will allow ready participants to work towards the next stage of seamlessly connecting their instant payment systems.

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

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

4 Nexus is designed to standardise the way domestic IPS connect to one another. Rather than an IPS operator building custom connections for every new country to which it connects, 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.

5 "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," said Agustín Carstens, General Manager of BIS.

6 "Nexus can reshape cross-border payments. Accessible, secure and convenient cross-border instant payments will drive financial inclusion and spur economic integration between countries. This major milestone was made possible by the leadership of the BIS and the commitment of forward-thinking partners to develop Nexus as a global public good, in line with G20 and ASEAN priorities. Important work lies ahead, and we look forward to working closely towards the live implementation of Nexus in the next phase," said Chia Der Jiun, Managing Director of MAS.

7 "Empowered by a shared vision of efficient and reliable cross-border payments, the collaboration between the BIS and ASEAN central banks has been rather effective, and I'd like this to continue. Central banks have always played a role in payments as a public good. With Nexus, this role will be extended to cross-border payments, maximizing the network effects. Thus, the Bangko Sentral ng Pilipinas will continue to work with the Philippine payments industry, BIS and other interested countries towards its live implementation. We look forward to Nexus providing overseas Filipinos with a cheaper and faster means to send money to family back home, and facilitating the globalisation of Filipino small and medium scale enterprises," said Eli M. Remolona Jr, BSP Governor.

8 "With the completion of phase three, we are another step closer to implementing a next-generation cross-border payment infrastructure. The comprehensive blueprint for taking Project Nexus forward is a product of the strong cooperation of participating ASEAN central banks working closely with the BIS to deliver a world-leading cross-border payment infrastructure that will not only benefit our nations but also pave the way for greater global payment connectivity. We welcome India to the next phase of Project Nexus," said Abdul Rasheed Ghaffour, BNM Governor.

9 "The Bank of Thailand is pleased to continue to be part of Project Nexus in transforming cross-border payments by connecting multiple fast payment systems to form a scalable global network. Workers living abroad are in a good position to benefit from Nexus, as it addresses their pain points in making traditional cross-border transactions. While Nexus has started in ASEAN, it has a global ambition-as it will be able to link up very easily and speedily with other economies," said Sethaput Suthiwartnarueput, Bank of Thailand Governor.

10 "India's fast payment system, viz., UPI has made phenomenal progress in recent years and has become an international trend-setter with more than 400 million transactions per day. We are happy at the launch of Project Nexus as it will link the Fast Payment Systems of the six founding member countries and Reserve Bank of India will be happy to share its knowledge, experience and technical know-how with this initiative. In my view, the greatest advantage of Project Nexus will be to make cross-border payments much faster and less costly. As per a World Bank assessment, the average cost of remitting USD 200 across borders is about 6.2%. Project Nexus will bring down this cost. This is a precursor to greater international cooperation among countries to enable faster cross-border remittances at a lower cost," said Shaktikanta Das, Reserve Bank of India Governor.

11 The conclusions and lessons of phase three of Nexus are described in a report 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.

12 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.

13 The NSO will be wholly owned by the central banks and/or IPS in participating countries, depending on the specific domestic structures. In developing the blueprint in phase three 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.

14 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 cooperation among members and the entry of new participants, helping to realise Nexus's global ambition.

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Notes to editor:

This work follows an earlier phase of development in which a prototype of Nexus was used to successfully connect the test versions of three established IPS: the Eurosystem's TARGET Instant Payment Settlement (TIPS), Malaysia's Real-time Retail Payments Platform (RPP) and Singapore's Fast and Secure Transfers (FAST) payment system. (This work is described in Annex 1 of the new report.)

In November 2022, Bank Indonesia, Bank Negara Malaysia, Bangko Sentral ng Pilipinas, the MAS and the Bank of Thailand signed a Memorandum of Understanding (MoU) on Cooperation in Regional Payment Connectivity, which highlights the collaborative effort within the region towards establishing cross-border payment connectivity, including via fast payment linkages. Since the signing of the MoU, Brunei Darussalam Central Bank, Bank of the Lao People's Democratic Republic and the State Bank of Vietnam have joined the initiative.

The BIS Innovation Hub commenced the project in 2022, and its Singapore Centre has worked with the current partners over the past year to develop a comprehensive scheme and governance framework, commercial model and technology blueprint.

Central banks, standard-setting bodies, IPS operators and commercial entities around the world were also consulted to validate that Nexus is scalable and interoperable beyond the current participants. Nexus is one of many exploratory projects embarked upon by the BIS Innovation Hub. It is also contributing with the BIS Committee on Payments and Market Infrastructures to the G20 Roadmap for Enhancing Cross-border Payments. The Roadmap highlights interlinking of IPS as a key aim, and Nexus as a priority action that could have a significant impact on the speed, cost, transparency of, and access to cross-border payments.

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