- The Central Bank of Bahrain (CBB) has announced that it will work alongside JP Morgan and Bank ABC in a new push to speed up international money transfers.
- The arrangement will be powered in part by digital currencies, reflecting the trend among central banks to start investigating the use of central bank digital currencies (CBDCs).
- The governor of the CBB said that the organisation wanted to tackle problems such as inefficiencies in the international money transfer sector.
The Central Bank of Bahrain (CBB) has confirmed that it will work alongside global investment bank JP Morgan to design a new service for cross-border payments.
The service, which will initially be run on a pilot basis, will see funds moved from Bahrain in US dollars to settle bills between purchasers and suppliers of goods.
The aim is for the suppliers to receive their cash quickly and for buyers to be able to place payments without having to accumulate lots of holding funds ahead of time.
It will be powered in part by digital currencies, or central bank digital currencies (CBDCs).
It is becoming increasingly common for global central banks to collaborate with larger financial services organisations to look into this sort of technology for cross-border payments.
In the case of the CBB, the pairing will be aided by another institution – Bank ABC.
Bank ABC is an international bank that has a presence in a number of different countries around the world.
The three organisations will work in partnership with a view to working together more as time goes on.
In a statement, the governor of the CBB explained more about the context of the new move.
Rasheed Al-Maraj said that the bank was looking to use “emerging technologies” to improve the experience of stakeholders in the sector.
“We at the Central Bank of Bahrain are extremely pleased to announce this collaboration which is in line with our vision and strategy to continually develop and enrich the capabilities extended to the stakeholders within our financial services sector in the Kingdom using emerging technologies,” he said.
He added that a big aim of the new project was to drive down the “inefficiencies” that exist at the moment in the online money transfer sector.
“Through this pilot with J.P Morgan and Bank ABC, we aspire to address the inefficiencies and pain-points which exist today in the traditional cross-border payments arena,” he added.
For Bank ABC, the deputy group chief executive Sael Al Waary said that the firm was “excited to collaborate with the CBB and JP Morgan in this landmark pilot, to develop a more efficient payments infrastructure, focused on addressing the current limitations in cross-border payments”.
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