IMF's Call To Arms For The CBDC Revolution At The Singapore FinTech Festival

IMF Managing Director Kristalina Georgieva called for faster adoption of central bank digital currencies (CBDCs) to improve sluggish and costly cross-border payments at the Singapore FinTech Festival on Wednesday.

Georgieva’s Keynote Address Highlights: During her address, Georgieva emphasized the potential of CBDCs to not only replace cash, especially in island economies, but also to advance financial inclusion in regions with low bank account ownership.

She pointed out, "Adoption of CBDCs is nowhere close. But about 60% of countries are exploring them in some form today,” adding that “they must be built to facilitate cross-border payments, which are at present expensive, slow, and available to few,” South China Morning Post reported.

Singapore FinTech Festival Overview: The major technology gathering had 62,000 participants including industry leaders such as Amazon.com, Inc. AMZN, Binance BNB/USD and HSBC Holdings plc HSBC, discussing various fintech advancements.

Philippines President on Financial Inclusion: Echoing Georgieva's sentiments, Phillippines President Ferdinand Marcos Jr. recognized the importance of digital banking and inclusive finance, stating, "[We] recognize the growing presence of digital banking, and the importance of inclusive finance for our financial landscape so that no one will be left behind in our pursuit of progress and prosperity.”

IMF’s New Handbook Launch: At the festival, the IMF introduced a new handbook to assist policymakers in accelerating the use and launch of CBDCs.

Benefits of CBDCs: Georgieva highlighted the efficiency CBDCs could bring to cross-border payments, potentially lowering costs for small businesses.

“While we see encouraging declines in the cost of remittances, they remain above Sustainable Development Goal targets,” she noted,

Also Read: Central Banks Are Exploring CBDCs, But Don't Expect A Digital Dollar Anytime Soon

Call For Collaborative Development: Georgieva encouraged the development of more cross-border platforms or “next-generation virtual town squares” for exchanging CBDCs and other digital assets among central and commercial banks, fintech companies and the public sector.

Singapore’s Role In CBDC Adoption: Georgieva commended Singapore’s Monetary Authority (MAS) for its active role in supporting CBDC adoption and faster payment systems.

MAS’s “Project Guardian” announced five new industry pilots for digital money and asset exchange.

Ant Group’s Collaboration And Expansion: Ant Group, a key player in fintech, partnered with the National Bank of Cambodia to enhance cross-border mobile payments and announced its global expansion strategy from Singapore.

MAS’s Project MindForge: MAS concluded phase one of Project MindForge, focusing on AI use in finance, and plans to publish its findings in January.

Singapore President On AI's Future Impact: In a dialogue, Singapore President Tharman Shanmugaratnam discussed AI's evolving role, predicting significant changes in the workforce over the next decade.

“This technological revolution is going to have a more profound effect on the workforce than any previous technological revolution,” he said.

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