The Reserve Bank of Australia (RBA) has recently released a report focusing on the advantages and obstacles of connecting fast payment systems internationally for cross-border payments. According to the report, linking these systems has the potential to enhance the speed and transparency of cross-border transactions, benefiting both users and service providers.
The report emphasizes the significance of well-designed governance, scheme rules, and payment processing capabilities in managing risks and ensuring a smooth cross-border payments experience. However, challenges arise from differences in legal and regulatory frameworks among participating countries, as well as the need to establish governance arrangements and scheme rules.
"Cross-border payments are vital in an interconnected world. Further efforts are needed to make them faster, cheaper and more transparent. This study marks an important step toward understanding the potential for linking fast payment systems to drive improvements in these areas," stated Brad Jones, Assistant Governor (Financial System) at the RBA.
The international attention towards linking national fast payment systems as a means to enhance cross-border payments has been acknowledged. The RBA has collaborated with Australian industry participants to explore the interlinking of fast payment systems, contributing to the global discussion on this subject.
As international payments activity grows, the demand for efficient, competitive, and secure cross-border payment services increases. The G20 countries, including Australia, have committed to improving cross-border payments, with a focus on fostering the interlinking of fast payment systems as a priority initiative.
Enhancing cross-border payments is a strategic priority for the RBA's Payments System Board, aligning with the G20's roadmap to enhance cross-border payments and aiming to achieve better outcomes for users in Australia and globally. The report encourages further analysis of key design considerations and will inform future discussions regarding linking the New Payments Platform (NPP) with fast payment systems in other countries.