Singapore’s central bank, the Monetary Authority of Singapore (MAS), has announced a pilot program for a live Singapore dollar-based central bank digital currency (CBDC). This wholesale CBDC will be used by local banks for settlements. MAS Managing Director Ravi Menon revealed the plan during the Singapore Fintech Festival. Previously, the MAS had only simulated the issuance of a CBDC in test environments. Now, the central bank will partner with Singaporean banks to test the use of a CBDC as a settlement asset for domestic payments. The pilot program involves banks issuing tokenized liabilities that represent claims on their balance sheets. Retail customers can then use these tokenized liabilities to transact with merchants, with settlement occurring via an automatic transfer of a wholesale CBDC. This new system aims to streamline clearing and settlement, eliminating the need for separate systems and reducing settlement lag. The MAS has also introduced additional industry pilots to its financial infrastructure test program, expanding the project to include major financial institutions such as BNY Mellon, HSBC, and Citi Group. These pilots will assess various use cases around asset tokenization. The MAS has been actively exploring the utility of CBDCs, with a six-year-long trial program called Project Ubin showing that CBDCs have the potential to make cross-border payments more efficient and cost-effective.

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Information	Details
Geography	Asia
Countries	🇸🇬
Sentiment	positive
Relevance Score	1
People	Ravi Menon, Sandeep Nailwal
Companies	HSBC, Citi Group, Singapore Fintech Festival, MAS, BNY Mellon
Currencies	None
Securities	None