- The BIS has teamed up with central banks from Australia, Singapore, Malaysia and more.
- The agencies collaborated for Project Mandala, a cross-border payment system.
- The framework uses both CBDCs and traditional systems like Swift.
The Bank for International Settlements (BIS) has partnered with central banks from Singapore, Australia, South Korea, and Malaysia to improve cross-border payment systems through Project Mandala.
According to a press release from the Monetary Authority of Singapore (MAS), Mandala integrates regulatory compliance directly into transaction protocols, protecting privacy while improving compliance with international regulations. This reduces the regulatory burden of cross-border transactions.
Project Mandala: Enhancing Compliance and Privacy
The project uses features like a peer-to-peer messaging system, rules engine, and proof engine, which verify compliance without revealing user data. Maha El Dimachki, Head of the BIS Innovation Hub in Singapore, called this a pioneering approach to ensure data privacy across borders.
Project Mandala’s framework works with both digital asset systems, including central bank digital currencies (CBDCs), and traditional systems like Swift.
Notably, Mandala has reached the proof-of-concept stage and has successfully completed two use cases: cross-border lending between Singapore and Malaysia and capital financing between South Korea and Australia. According to the MAS, each trial showed that the project can automate compliance requirements, enabling real-time monitoring and reporting for central banks.
Sopnendu Mohanty, Chief FinTech Officer at MAS, said that the MAS helped develop Project Mandala and extended the “architecture of Purpose Bound Money” to support “capital flow management and sanctions screening.”
Singapore’s Balance Between Innovation and Compliance
In recent years, Singapore has established itself as a hub for blockchain innovation. According to Coincub’s Global Crypto Ranking 2022 (Q4), Singapore is the third-most crypto-friendly country.
The Singaporean government aims to balance innovation with consumer protection through its regulatory framework. Last year, the MAS teamed up with authorities in Japan, Switzerland, and the United Kingdom to work on establishing high interoperability standards for cross-border digital asset payments.
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