SWIFT intends to introduce a CBDC interconnection system within the coming two years.

SWIFT, the organization behind the widely-used network connecting global private banks, is venturing into the central bank digital currency (CBDC) payment sector. The Belgium-based cooperative has unveiled plans to introduce a CBDC platform aimed at integrating various national digital currencies into the existing financial infrastructure.

This decision by SWIFT follows a successful six-month pilot program aimed at assessing the feasibility of such a solution. The pilot involved 38 financial entities, including central banks, commercial banks, and others.

Nick Kerigan, SWIFT's head of innovation, discussed the potential timeline for launching this interconnection network in an interview with Reuters. He outlined:

"We are developing a roadmap to bring this product to market within the next 12 to 24 months. It is transitioning from an experimental phase to a tangible reality."

While many central banks around the world are exploring the concept of issuing digital versions of their currencies, only a handful have progressed to implementation. Countries like the Bahamas, Nigeria, and Jamaica have already introduced their CBDCs, while China has an advanced pilot program underway.

Despite this, SWIFT's initiative could establish a foundation for a centralized CBDC system, even as these currencies are rolled out, positioning itself ahead of competitors. This is feasible because SWIFT's interconnection systems operate independently of the underlying architecture of the individual digital currencies they will support.

Other platforms aiming to aggregate CBDCs and facilitate trading and payments are also in development. For instance, Project Mbridge, which brings together digital currencies from the UAE, China, Hong Kong, and Thailand, achieved a significant milestone in January by facilitating the first cross-border payment involving digital dirhams.