Digital currencies continue to make their way into the mainstream, with government entities elevating their exploration of the technology.
This week’s look at payment rails innovation finds the Monetary Authority of Singapore, the Bank of England, and others stepping further into the digital currency space to tackle payments friction in ways that legacy rails potentially cannot address. As they do so, their involvement with blockchain as payments infrastructure will deepen, too.
OpenPayd Embraces Crypto Payments
Banking-as-a-Service FinTech OpenPayd recently made a big show of support for cryptocurrency payments, announcing last week the launch of its banking and payments offering designed for businesses operating in the crypto space. The business finserv suite of services enables companies to access multi-currency payment accounts that support payments in fiat currencies, while also bridging these firms to digital currency purchasing via debit card, credit card or bank transfer. OpenPayd is also offering technology to support fiat-crypto currency exchange.
The new product suite signals support for mixing both legacy and newer payment infrastructures, with OpenPayd’s application programming interface (API)-powered services wielding bank rails for companies operating within a blockchain-powered ecosystem.
Bank Of England Braces For Digital Currency
“We’ll go on looking at it, as it does have huge implications on the nature of payments and society,” the BoE’s governor, Andrew Bailey, said.
The BoE isn’t the first central bank to consider digital currencies, with several central banks currently collaborating on exploring central bank digital currencies (CBDCs) to address friction in cross-border payments and accelerate transactions. Such an effort would likely require the development of entirely new payment rail infrastructure, and, as Bailey noted, central banks’ most pressing priorities continue to focus on post-pandemic economic recovery.
Temasek, Singapore Offer Crypto Guidance
One of the biggest challenges of the cryptocurrency space and wielding blockchain for digital currency payments is a lack of standardization and industry best practices. Yet as more mainstream financial institutions (FIs) and regulators step into the digital currency arena, they’re collaborating to mitigate risk and promote efficiencies.
The latest to do so are the Monetary Authority of Singapore (MAS) and Singapore government-owned investment house Temasek. Together, the entities are collaborating on the development of a framework for other FIs and entities to use blockchain for cross-border payments in multiple currencies.
The partners are now in the final phase of the initiative called Project Ubin. In their announcement, the organizations noted, “An international settlement network, modeled after this payments network prototype, could enable faster and cheaper transactions than conventional cross-border payments channels.”
NYMBUS, Payrailz Team Update Legacy Tech
Together, financial services platform provider NYMBUS and digital payments company Payrailz are teaming up to address friction for banks and other FIs to provide enhanced payments to their own customers. NYMBUS is now connecting banks and credit unions to Payrailz’ digital payments and billing management technology integrated within its own Banking-as-a-Service offering, SmartLaunch. The technologies address points of friction associated with legacy payment rails to help FIs accelerate their payments digitization rollouts, which is particularly important as end customers today demand digital, contactless payment solutions, the firms noted.