Payments Training Hub
Cross border payments have been slow PAYMENT OPERATIONS STARTED LIVE 01 Cross border payments - expensive for decades ACTIVE 02 Platform - payment from a bank in one country to a bank QUEUED 03 Instead of building a new currency - connects existing domestic instant QUEUED 04 Several countries in Asia - linked their instant payment systems QUEUED 05 Need the same supporting - Both need the same supporting work. QUEUED Cross border payments have been slow and expensive for decades Step 1 of 5 Cross border payments have been slow STARTED Cross border payments expensive for decades ACTIVE Platform payment from a bank in one country to a QUEUED Instead of building a new currency connects existing domestic instant payment QUEUED Several countries in Asia linked their instant payment systems QUEUED Need the same supporting Both need the same supporting work. QUEUED Cross border payments have been slow and expensive for decades
Platform uses a common ledger PAYMENT OPERATIONS IN PROGRESS LIVE 01 Cross border payments - expensive for decades DONE 02 Platform - payment from a bank in one country to a bank ACTIVE 03 Instead of building a new currency - connects existing domestic instant QUEUED 04 Several countries in Asia - linked their instant payment systems QUEUED 05 Need the same supporting - Both need the same supporting work. QUEUED The platform uses a common ledger, so that a payment from a bank in one country to a bank in another can settle in seconds, with the exchange of currencies happening on the platform itself. Step 2 of 5 Platform uses a common ledger IN PROGRESS Cross border payments expensive for decades DONE Platform payment from a bank in one country to a ACTIVE Instead of building a new currency connects existing domestic instant payment QUEUED Several countries in Asia linked their instant payment systems QUEUED Need the same supporting Both need the same supporting work. QUEUED The platform uses a common ledger, so that a payment from a bank in one country to a bank in another can settle in seconds, with the exchange of currencies happening on the platform itself.
Instead of building a new currency PAYMENT OPERATIONS IN PROGRESS LIVE 01 Cross border payments - expensive for decades DONE 02 Platform - payment from a bank in one country to a bank DONE 03 Instead of building a new currency - connects existing domestic instant ACTIVE 04 Several countries in Asia - linked their instant payment systems QUEUED 05 Need the same supporting - Both need the same supporting work. QUEUED Instead of building a new currency, it connects existing domestic instant payment systems to each other, so that a payment from a person in one country can reach a person in another country Step 3 of 5 Instead of building a new currency IN PROGRESS Cross border payments expensive for decades DONE Platform payment from a bank in one country to a DONE Instead of building a new currency connects existing domestic instant payment ACTIVE Several countries in Asia linked their instant payment systems QUEUED Need the same supporting Both need the same supporting work. QUEUED Instead of building a new currency, it connects existing domestic instant payment systems to each other, so that a payment from a person in one country can reach a person in another country
Several countries in Asia have already PAYMENT OPERATIONS IN PROGRESS LIVE 01 Cross border payments - expensive for decades DONE 02 Platform - payment from a bank in one country to a bank DONE 03 Instead of building a new currency - connects existing domestic instant DONE 04 Several countries in Asia - linked their instant payment systems ACTIVE 05 Need the same supporting - Both need the same supporting work. QUEUED Several countries in Asia have already linked their instant payment systems bilaterally Step 4 of 5 Several countries in Asia have already IN PROGRESS Cross border payments expensive for decades DONE Platform payment from a bank in one country to a DONE Instead of building a new currency connects existing domestic instant payment DONE Several countries in Asia linked their instant payment systems ACTIVE Need the same supporting Both need the same supporting work. QUEUED Several countries in Asia have already linked their instant payment systems bilaterally
Need the same supporting work PAYMENT OPERATIONS COMPLETE LIVE 01 Cross border payments - expensive for decades DONE 02 Platform - payment from a bank in one country to a bank DONE 03 Instead of building a new currency - connects existing domestic instant DONE 04 Several countries in Asia - linked their instant payment systems DONE 05 Need the same supporting - Both need the same supporting work. ACTIVE Both need the same supporting work. Step 5 of 5 Need the same supporting work COMPLETE Cross border payments expensive for decades DONE Platform payment from a bank in one country to a DONE Instead of building a new currency connects existing domestic instant payment DONE Several countries in Asia linked their instant payment systems DONE Need the same supporting Both need the same supporting work. ACTIVE Both need the same supporting work.

Key points of this lesson, in order.

0:00 / 2:23 Step 1 of 5

Cross Border Innovation: mBridge and Project Nexus

CBDCs, Stablecoins and AI in Payments, Lesson 4 of 9, Narration 2:23, D15 Advanced and emerging payments

Correspondent bankingSettlement

What you will learn

Your objective. By the end of this lesson, you will be able to explain cross border innovation: mbridge and project nexus. Cross border payments have been slow and expensive for decades, because they rely on correspondent banking, where a payment passes through several banks, each taking a fee and adding a delay, and where the sender often.

Why it matters. For a BA, the lesson from both projects is that cross border innovation is not about one technology winning, it is about solving the same problems in different ways.

Chapter objective: Learner explains central bank digital currencies, stablecoins, and AI in payments, comparing them with existing rails on speed, settlement, risk, and regulation, and assesses a realistic use case. Learner practises this skill on realistic banking cases, explaining the reasoning clearly and using correct terminology throughout the work.

Key learning points

  • Cross border payments have been slow
  • Platform uses a common ledger
  • Instead of building a new currency
  • Several countries in Asia have already
  • Need the same supporting work

Key terms

Correspondent banking: A service where one bank holds accounts for another bank so the second bank can make payments in currencies or countries where it has no branch.

Settlement: The final movement of funds between banks to discharge obligations created by cleared payments. Settlement is usually made in central bank money or through correspondent accounts.

Payment flow diagram showing Cross Border Innovation: mBridge and Project Nexus.

Practise this lesson

Exercise

Apply the concept in this lesson to a real banking scenario.

Use the definition, the example and the key points in this lesson.

  1. What to do. Explain the concept in your own words, give a banking example with an amount, and state what goes wrong if it is misunderstood.

Correct result. A correct answer names the concept accurately, uses a realistic banking example with a concrete amount, and identifies the consequence of getting it wrong.

Why. Understanding is not memorising a definition. It is being able to explain it, apply it, and spot the failure it prevents.

Check your understanding

Practice question

A startup proposes settling cross-border payments on a public blockchain with no intermediary banks. A bank risk officer asks what changes for settlement finality. What is the key point?

Takeaway and next step

What to remember

The real test for any of these initiatives is whether they can handle real volumes, real compliance requirements and real customer expectations, day after day.

Build a cross-border payment like the one in this lesson and watch the chain, the charges, and the final amount change.

Open the Cross-Border Payment Configurator →

Builds on "AI in Fraud Detection and Operations".

Transcript and full text

Show transcript

Cross border payments have been slow and expensive for decades, because they rely on correspondent banking, where a payment passes through several banks, each taking a fee and adding a delay, and where the sender often cannot see where the money is. Two major initiatives are trying to change that. Project mBridge, run by the Bank for International Settlements with several central banks, tests a shared platform where banks settle cross border payments directly with wholesale CBDCs, without correspondent banks. The platform uses a common ledger, so that a payment from a bank in one country to a bank in another can settle in seconds, with the exchange of currencies happening on the platform itself. Early tests show it can cut cost and time dramatically, although legal questions, such as which law applies when a payment crosses borders, are still being worked through. Project Nexus, also run by the Bank for International Settlements, takes a different approach. Instead of building a new currency, it connects existing domestic instant payment systems to each other, so that a payment from a person in one country can reach a person in another country through their own national systems. Each country connects once to the Nexus hub, rather than building a separate connection to every other country, which makes the network scalable. The design standardises the messages, the compliance checks and the foreign exchange conversion, so that a cross border payment feels much like a domestic one. Several countries in Asia have already linked their instant payment systems bilaterally, and Nexus aims to make that multilateral, so that a payment from India to Singapore to Europe could travel through one connected network. For a BA, the lesson from both projects is that cross border innovation is not about one technology winning, it is about solving the same problems in different ways. mBridge solves settlement by creating a new asset, while Nexus solves connectivity by linking existing systems. Both need the same supporting work. Common message standards, agreed compliance and screening processes, clear liability rules, and foreign exchange arrangements that work at the point of payment. A BA who understands these building blocks can evaluate any new cross border proposal on its merits, rather than being impressed by the technology alone. The real test for any of these initiatives is whether they can handle real volumes, real compliance requirements and real customer expectations, day after day. Real-time cross-border payments are being built by linking domestic instant payment systems, and Project Nexus is the leading example. Nexus, run by the Bank for International Settlements Innovation Hub, connects the instant payment systems of Singapore, Malaysia, Thailand, the Philippines and India, so a payment can travel from one system to another in seconds. The design uses a central hub that routes the payment, converts the currency, and settles between the central banks. The first live connection, between Singapore's PayNow and Thailand's PromptPay, went live in 2021, and the volumes have grown steadily since. Nexus is now expanding to more countries, and the Bank for International Settlements published the Nexus scheme rulebook in 2024. The G20 roadmap for enhancing cross-border payments sets the targets that Nexus and the other initiatives are working toward. By 2027, the average cost of a retail cross-border payment should be no more than 1 percent, the payment should arrive within one hour for 75 percent of payments, and the sender should know the cost and the time before they confirm. The targets are measured annually by the Financial Stability Board, and the 2024 report showed progress but not yet achievement: the average cost was still above 1 percent for many corridors, and the speed target was not yet met. The roadmap is the reason the work is funded, and the business analyst must be able to state the targets and the current performance. Blockchain settlement for cross-border payments uses a distributed ledger to settle between banks without a correspondent. The model is that each bank holds a token representing central bank money or commercial bank money, and the payment is a transfer of the token from one bank to another, settled atomically, which means the payment and the settlement happen together, with no risk that one happens without the other. The model is being tested by the Bank for International Settlements in Project Agorá, which brings together central banks and commercial banks to test tokenised cross-border payments. The project is at the testing stage, and the participating banks are assessing whether the model can scale.

Cross border payments have been slow and expensive for decades, because they rely on correspondent banking, where a payment passes through several banks, each taking a fee and adding a delay, and where the sender often cannot see where the money is. Two major initiatives are trying to change that. Project mBridge, run by the Bank for International Settlements with several central banks, tests a shared platform where banks settle cross border payments directly with wholesale CBDCs, without correspondent banks. The platform uses a common ledger, so that a payment from a bank in one country to a bank in another can settle in seconds, with the exchange of currencies happening on the platform itself. Early tests show it can cut cost and time dramatically, although legal questions, such as which law applies when a payment crosses borders, are still being worked through.

Project Nexus, also run by the Bank for International Settlements, takes a different approach. Instead of building a new currency, it connects existing domestic instant payment systems to each other, so that a payment from a person in one country can reach a person in another country through their own national systems. Each country connects once to the Nexus hub, rather than building a separate connection to every other country, which makes the network scalable. The design standardises the messages, the compliance checks and the foreign exchange conversion, so that a cross border payment feels much like a domestic one. Several countries in Asia have already linked their instant payment systems bilaterally, and Nexus aims to make that multilateral, so that a payment from India to Singapore to Europe could travel through one connected network.

For a BA, the lesson from both projects is that cross border innovation is not about one technology winning, it is about solving the same problems in different ways. mBridge solves settlement by creating a new asset, while Nexus solves connectivity by linking existing systems. Both need the same supporting work. Common message standards, agreed compliance and screening processes, clear liability rules, and foreign exchange arrangements that work at the point of payment. A BA who understands these building blocks can evaluate any new cross border proposal on its merits, rather than being impressed by the technology alone. The real test for any of these initiatives is whether they can handle real volumes, real compliance requirements and real customer expectations, day after day.

Real-time cross-border payments are being built by linking domestic instant payment systems, and Project Nexus is the leading example. Nexus, run by the Bank for International Settlements Innovation Hub, connects the instant payment systems of Singapore, Malaysia, Thailand, the Philippines and India, so a payment can travel from one system to another in seconds. The design uses a central hub that routes the payment, converts the currency, and settles between the central banks. The first live connection, between Singapore's PayNow and Thailand's PromptPay, went live in 2021, and the volumes have grown steadily since. Nexus is now expanding to more countries, and the Bank for International Settlements published the Nexus scheme rulebook in 2024.

The G20 roadmap for enhancing cross-border payments sets the targets that Nexus and the other initiatives are working toward. By 2027, the average cost of a retail cross-border payment should be no more than 1 percent, the payment should arrive within one hour for 75 percent of payments, and the sender should know the cost and the time before they confirm. The targets are measured annually by the Financial Stability Board, and the 2024 report showed progress but not yet achievement: the average cost was still above 1 percent for many corridors, and the speed target was not yet met. The roadmap is the reason the work is funded, and the business analyst must be able to state the targets and the current performance.

Blockchain settlement for cross-border payments uses a distributed ledger to settle between banks without a correspondent. The model is that each bank holds a token representing central bank money or commercial bank money, and the payment is a transfer of the token from one bank to another, settled atomically, which means the payment and the settlement happen together, with no risk that one happens without the other. The model is being tested by the Bank for International Settlements in Project Agorá, which brings together central banks and commercial banks to test tokenised cross-border payments. The project is at the testing stage, and the participating banks are assessing whether the model can scale.

Full lesson text (all scenes)

Completing a lesson updates your progress dashboard on the homepage.

Scene timestamps are estimated by allocating the narration text proportionally across the real audio length. The audio playback position is the source of truth: pause freezes the visual, seeking restores the correct scene, replay restarts the scene animation.