The Bank of England, the Monetary Authority of Singapore, and the Bank of Thailand have released findings from Project Meridian FX APAC, a collaboration focused on improving foreign exchange (FX) settlement. The project explored synchronisation, a service that coordinates central bank money movements, as a way to enhance interoperability across different wholesale settlement technologies and operating models. This initiative marks a significant step toward making cross-border FX transactions safer and more efficient, especially as various forms of money evolve differently.
The trial tested payment-versus-payment FX settlement and multilateral net FX across the central banks’ test environments, which included both Real-Time Gross Settlement and Distributed Ledger Technology-based systems. The project spanned multiple currencies, technologies, infrastructures, and time zones. Partior, the delivery partner, developed and tested a Synchronisation Operator prototype for the trial. The results demonstrated that synchronised settlement is achievable across diverse central bank systems, while also identifying the requirements and trade-offs involved.
The project also examined legal, regulatory, and oversight considerations for applying synchronised FX settlement across different wholesale settlement systems. Insights were gathered from observer central banks, including the Reserve Bank of Australia and Bangko Sentral ng Pilipinas. The findings are detailed in three reports: an Introduction and Executive Summary, a Technical Report, and a Policy Report. These documents outline experimental results, key technical findings, and policy considerations.
Tom Mutton, Executive Director of Payments, Innovation and Fintech at the Bank of England, highlighted the practical evidence provided by the project in reducing risk and improving efficiency in cross-border FX transactions. Kenneth Gay, Chief FinTech Officer at the Monetary Authority of Singapore, noted how synchronisation could enable payment-versus-payment settlement across diverse environments. Pucktada Treeratpituk, Director of Payment Systems and Financial Technology Policy Department at the Bank of Thailand, emphasized the project’s success in making cross-border FX safer and more efficient.