Central Banks Collaborate to Streamline Cross-Border Transactions and Compliance

In a bid to revolutionize cross-border transactions and alleviate the challenges associated with regulatory compliance, the Bank for International Settlements (BIS) is spearheading a groundbreaking initiative known as Project Mandala, according to Finextra. Collaborating with central banks from Australia, Korea, Malaysia, and Singapore, this ambitious project aims to embed regulatory requirements directly into real-time transactions, marking a significant leap forward in the world of international finance.

The contemporary landscape of cross-border payments has long been plagued by the complexities arising from disparate policy and regulatory frameworks across different jurisdictions. These disparities not only create a regulatory compliance burden that ripples throughout the payment chain but also extend transaction times and breed uncertainties among all stakeholders involved.

Project Mandala is poised to tackle these obstacles head-on by automating compliance procedures, offering real-time transaction monitoring, and enhancing the transparency and visibility of country-specific policies. By doing so, it hopes to mitigate the challenges encountered during Project Dunbar, a previous BIS-led initiative that explored an experimental multiple central bank digital currency (mCBDC) platform.

The underlying concept of compliance by design holds the potential to streamline the cross-border transfer of various digital assets, including Central Bank Digital Currencies (CBDCs) and tokenized deposits. Furthermore, it could serve as the foundational compliance layer for both established and emerging wholesale or retail payment systems, promising a comprehensive solution to the prevailing regulatory challenges.

Among the measures currently under investigation are quantifiable and configurable foreign exchange rules, as well as stringent anti-money laundering and countering the financing of terrorism (AML/CFT) measures. These measures, when successfully integrated into cross-border transactions, could usher in a new era of efficiency and security in international finance.

This groundbreaking endeavor signifies a crucial step forward in the quest for more streamlined, efficient, and secure cross-border transactions. As the global financial landscape evolves, the collaboration between central banks and the BIS in Project Mandala showcases a commitment to harnessing technology and innovation to address the long-standing challenges of international payments and compliance.

Other articles
Financing Trends Shaping the Auto Industry in 2025
The Hidden Risks of AI-Generated Code in Banking Systems
Spendesk Adopts Dust’s AI Platform to Enhance Security and Efficiency
Klarna Expands BNPL Services to eBay Shoppers in the US
Can Embedded Finance Help Neobanks Outperform Traditional Banks?
Google Deploys AI to Wipe Out Half a Billion Scam Ads in 2024
MoneyGram and Plaid Join Forces to Deliver Seamless, Secure Global Payments
The Rise of AI and ML in Modernizing KYC Compliance
Embedded Finance: Will It Overtake Standalone Banking Apps?
2025 Report: Drivers Demand Seamless In-Car Payment Systems, Willing to Pay for Convenience
How AI and Technology Are Reshaping Finance in 2025
What’s Fueling the Surge in Embedded Finance Adoption?
Bank of England Warns of AI Risks to Financial Stability
Jamie Dimon Warns of FinTech Threat as Consumer Payments Become Banking’s New Battleground
Mercedes-Benz Introduces In-Car Fingerprint Payment with Mercedes pay+