French central banker suggests blockchain for cross border payments

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Daniel Webber
Daniel Webber
Founder & CEO
Daniel is Founder and CEO of FXcompared and has 18 years of experience in the international finance world focusing on cross-border payments, technology and the property sectors. Daniel is widely… Read more

•       Denis Beau, a senior figure at the Banque de France, outlined his support for looking into a central bank digital currency

•       He said that the Eurozone should look into the options available in order to see whether further cross border payments solutions could be developed

•       “We, at the Banque de France, are therefore quite open for experiments in that direction, together with the European Central Bank (ECB) and other central banks of the Eurosystem”, he added

 

A major central banker in France has given a speech outlining his belief that blockchain could help improve cross border payments.

Denis Beau, who serves as the first deputy governor of the Banque de France, made the comments in a speech last week.

He confirmed in that speech that he believes France ought to look into a central bank digital currency (CBDC).

In the speech, he touched on a range of issues which currently face those wanting to make remittance payments – and while he accepted that some progress had been made, it hadn’t gone far enough.

“In the recent years, there has been a strong demand for quick and safe cross-border payment

solutions, available 24/7, enabling smooth exchanges”, he said.

“In Europe, various domestic instant payment solutions have emerged in a certain number of countries, available 24/7, settling retail payment orders up to 15 000 euros in less than 15 seconds.”

“However, cross-border payment solutions are still costly for end users, slow and unsafe across the world, in particular in emerging countries”, he added.

He did, however, add some caveats to his support for a blockchain solution.

He made it clear that he was seeking to work alongside others to experiment, and he emphasised that it was something that could “possibly” be done.

“As a major provider of critical wholesale clearing and settlement services in euro, [the Eurozone] should be open to experimenting these innovations in order to revisit and possibly improve the conditions under which we make available central bank money as a settlement asset”, he said.

“We, at the Banque de France, are therefore quite open for experiments in that direction, together with the European Central Bank (ECB) and other central banks of the Eurosystem, in particular with regard to a wholesale CBDC", he added.

He also touched on the issue of risks

“Risks in a digitalised world do not recognize borders”, he explained.

He then discussed the importance of ensuring that regulatory frameworks work in harmony rather than incoherently and said that the French decision to participate in a “cyber-attack simulation exercise” reflected part of the country’s commitment to safety.

The Banque de France is the central bank of France. However, its authority is in many ways – including on monetary policy – superseded by the European Central Bank and the Eurosystem, of which it is a member.

Blockchain has long been a key part of the debate when it comes to online money transfer.

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