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Project Nexus
Context: India’s Unified Payments Interface (UPI) and Fast Payments Systems (FPSs) of Malaysia, the Philippines, Singapore and Thailand will be interlinked through Nexus.
Project Nexus:
- It is an initiative conceptualised by the Innovation Hub of the Bank for International Settlements (BIS).
- It aims to enhance cross-border payments by interlinking multiple domestic instant payment systems (IPS) globally.
- It is also looking to standardise the way IPS connects to each other, allowing for a single connection to the Nexus platform to reach all other countries on the network.
- This initiative is the first of its kind from the BIS Innovation Hub to move towards live implementation in the payments area.
- Founding members include the FPSs of India, Malaysia, the Philippines, Singapore, and Thailand.
- Indonesia is expected to join in the future.
- To facilitate live implementation, the partner central banks and IPS operators have agreed to work towards establishing a new entity, the Nexus Scheme Organisation (NSO).
- It will be responsible for managing the Nexus scheme, and continuing the mission to achieve instant cross-border payments at scale.
- Benefits:
- Facilitates cross-border payments within 60 seconds in most cases.
- Accelerates the growth of instant cross-border payments.
- Reduces the need for custom connections for every new country, streamlining the process.
- Advantages for India:
- Reserve Bank of India (RBI) has been actively collaborating bilaterally to link India’s UPI with other countries’ FPSs for cross-border Person to Person (P2P) and Person to Merchant (P2M) payments.
- Project Nexus provides a multilateral approach, enhancing international reach of Indian payment systems and benefiting from faster, standardised, and more extensive cross-border payment infrastructure