MAS launches global challenge to seek solutions for retail central bank digital currency

SINGAPORE (THE BUSINESS TIMES) – The Monetary Authority of Singapore (MAS) is inviting fintech companies and financial institutions around the world to propose innovative retail central bank digital currency (CBDC) solutions.

In its Global CBDC Challenge announced on Monday (June 28), MAS said it seeks market-ready solutions that can address 12 problem statements centred on three key areas: improving and expanding accessibility and utility of digital payments, mitigating risks associated with payment transfers and market infrastructure, as well as providing a viable infrastructure that is low-cost, efficient and robust, and facilitates trusted settlement of payment transactions among participants.

“A retail CBDC built for next-generation financial rails has the potential to increase payments efficiencies, improve financial inclusion, and support the broader digitalisation drive in the economy,” said MAS.

However, the design and technology underpinning the solutions should meet several public policy objectives, such as cost-effectiveness and accessibility to a full spectrum of users, including low-income households that are less tech-savvy.

The design of the retail CBDC solution should contribute to financial system resilience and integrity, and be consistent with monetary and financial stability, MAS said.

The authority’s chief fintech officer, Mr Sopnendu Mohanty, said central banks are facing a wide range of policy and technology challenges in exploring issuance of digital currencies.

“Through the Global CBDC Challenge, MAS hopes to encourage innovator communities worldwide to develop and showcase solutions that can maximise the potential of CBDC to deliver efficiencies to payment services, improve financial inclusion, consistent with central banks’ core mandate of monetary stability,” he said.

Interested participants have until July 23 to submit their proposals. Up to 15 shortlisted finalists will be invited to participate in an eight-week acceleration phase, including networking and masterclass sessions with global leaders and industry experts.

Up to three winners will be announced in November at the Singapore FinTech Festival. Each will be awarded $50,000 in cash prizes.

The shortlisted finalists will also have access to the API Exchange (Apix) Digital Currency Sandbox for rapid prototyping of digital currency solutions.

The sandbox will offer a comprehensive test and development platform that includes core-banking APIs from Apix, payment APIs from Mojaloop Foundation, digital currency APIs from Mastercard, Partior and R3, and more than 100 APIs provided via the Apix marketplace. Amazon Web Services (AWS) will support finalists by providing access to the AWS platform and AWS promotional credits.

The finalists will be fast-tracked to receive up to $200,000 in a proof-of-concept grant offered by the MAS.

MAS’s Global CBDC Challenge is launched in partnership with the International Monetary Fund, World Bank, Asian Development Bank, United Nations (UN) Capital Development Fund, UN High Commission for Refugees, UN Development Programme and the Organisation for Economic Cooperation and Development.

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