## Cross-Border Payments with Retail Central Bank Digital Currencies: Design and Policy Considerations

_Fintech Notes, May 15, 2024_

## Source details

**Canonical URL:** [Cross-Border Payments with Retail Central Bank Digital Currencies: Design and Policy Considerations](https://www.imf.org/en/publications/fintech-notes/issues/2024/05/15/cross-border-payments-with-retail-central-bank-digital-currencies-547195)

## Other formats

- [Markdown version](/en/publications/fintech-notes/issues/2024/05/15/cross-border-payments-with-retail-central-bank-digital-currencies-547195/index.md)
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## Bibliographic details
- Authors: Andre Reslow, Gabriel Soderberg, Natsuki Tsuda
- Published: May 15, 2024
- Series: Fintech Notes
- DOI: https://doi.org/10.5089/9798400272035.063

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### Overview and Purpose
- Authors: Andre Reslow, Gabriel Soderberg, Natsuki Tsuda
- Publication date: May 15, 2024
- Series: Fintech Notes No 2024/002; Issue: 002; Volume: 2024; Pages: 43
- DOI: https://doi.org/10.5089/9798400272035.063
- ISBN: 9798400272035
- ISSN: 2664-5912
- Focus: Retail CBDC—primarily targeting households and non-financial firms; wholesale CBDC considerations left for future work though many discussions are applicable to wholesale CBDC and other forms of money.

### Key Findings on Cross-Border Payments with Retail CBDC
- CBDC can help overcome some of the frictions in cross-border payments.
- CBDC is a safe and liquid asset that reduces:
  - the number of financial intermediaries involved in a payment chain, and
  - settlement risk.
- Designing CBDC systems for cross-border payments is not fundamentally different from tailoring other payment systems, though:
  - roles and responsibilities in a CBDC system might be slightly different, and
  - the central bank may play a more pivotal role given CBDC’s nature as public money as opposed to commercial bank money.
- The note draws lessons from ongoing experimentation and research to identify design and policy considerations so retail CBDC systems may be compatible for cross-border payments.

### Design and Policy Considerations (summary)
- Compatibility objective:
  - Develop retail CBDC systems with cross-border payment compatibility in mind while recognizing jurisdictional variations in primary objectives.
- Central bank role:
  - Anticipate a more central role for central banks in a retail CBDC ecosystem relative to existing commercial-bank-based money systems.
- Operational design elements:
  - Reduce settlement layers and intermediaries to lower settlement risk and improve liquidity.
  - Tailor roles and responsibilities to reflect CBDC as public money.
- Scope boundaries:
  - The analysis and recommendations focus on retail CBDC; wholesale CBDC is excluded from the main scope but referenced where relevant.

### Subjects and Keywords (as listed)
- Subjects: Anti-money laundering and combating the financing of terrorism (AML/CFT), Central Bank digital currencies, Central banks, Crime, Currencies, Economic sectors, Financial institutions, Foreign exchange, Money, Nonbank financial institutions, Technology
- Keywords: Anti-money laundering and combating the financing of terrorism (AML/CFT), capital flow management, capital flow management measure, CBDC design consideration, central bank digital currencies, cross-border payment, cross-border payments, Currencies, eNaira, fintech, foreign exchange, Global, IMF Library, Nonbank financial institutions, provider restriction

*Cross-Border Payments with Retail Central Bank Digital Currencies: Design and Policy Considerations — Fintech Notes 2024/002 (May 15, 2024) by Andre Reslow, Gabriel Soderberg, Natsuki Tsuda.*

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_Source: https://www.imf.org/en/publications/fintech-notes/issues/2024/05/15/cross-border-payments-with-retail-central-bank-digital-currencies-547195_