Project Nexus

Reference

Recently, Reserve Bank of India (RBI) has joined Project Nexus. It is a multilateral international initiative to enable instant cross-border retail payments by interconnecting domestic Fast Payment Systems (FPS).

What is Project Nexus

• Project Nexus is a Bank for International Settlements (BIS) Innovation Hub project, which is moving towards live implementation.
• It aims to promote cross border payments by connecting multiple domestic Instant Payment Systems (IPS) on a global scale.
• BIS will play an advisory role in setting up the operational plan for Project Nexus and opening it up to potential new participants around the world.
• The Reserve Bank of India is collaborating bilaterally with various countries to link India's Fast Payment System (FPS) UPI with their respective FPS for cross-border person-to-person (P2P) and person-to-merchant (P2M) payments.

Benefits of Project Nexus

• Standardize the way Instant Payment Systems (IPS) connect to each other
  • Currently, domestic payments in over 70 countries are processed in seconds with virtually zero costs to the sender or recipient.
  • According to the Bank for International Settlements (BIS), connecting these instant payment systems could make cross-border payments possible from sender to recipient within 60 seconds (in most cases).
• Enabling payment system operators to create a single connection to the Nexus platform rather than having to create a custom connection for each new country.
• Allowing a fast payment system to reach all other countries on the network from a single connection
• Important in the development of cross border instant payments

Countries involved in Project Nexus

• Project Nexus aims to connect the four Association of Southeast Asian Nations (ASEAN) countries – Malaysia, Philippines, Singapore and Thailand – and India's FPS. These countries will be the founding members and first movers of this platform.
• The BIS will facilitate central banks and IPS operators from India, Malaysia, the Philippines, Singapore and Thailand as they work towards live implementation in the next phase, with the Bank of Indonesia as the special supervisor.