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The Singapore Monetary Authority (MAS) has rolled out a global challenge for retail central bank-issued digital currencies (CBDCs). The regulator seeks to attract FinTech firms and financial institutions across the globe into the country. Through this challenge, MAS is requesting such organisations to submit innovative solutions on CBDCs, their distribution, and infrastructure.
The challenge will comprise 12 problem statements selected by partner organisations across the globe. Reportedly, the regulator is launching this initiative in partnership with multiple global economic organisations. These are the International Monetary Fund (IMF), the World Bank, and the Organisation for Economic Co-operation and Development (OECD). Apart from these organisations, several UN agencies are partners in this project. These included the UN Capital Development Fund, High Commission for Refugees, and Development Program.
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MAS also pointed out some perks of CBDCs. According to the regulator, CBDCs can help streamline payments, improve financial inclusion, and help digitise the economy. While the agency believes CBDCs are beneficial, it asserts that such coins must adhere to several public policies.
MAS’ requirements of retail CBDCs
According to MAS, the CBDC solutions that the FinTech startups and companies provide need to be cost-effective for seamless implementation. Apart from this, they should be able to cater to the current and upcoming payment needs of consumers. On top of this, they should be accessible to a wide range of users, including lower-income households and people that are not well-versed with technology. MAS added that the CBDC solutions should also chip into financial system resilience and integrity while remaining consistent with monetary and financial stability regulations.
MAS said that interested firms should submit their applications for the CBDC challenge before July 23. After submitting proposals, the authority and its partners will pick a group of 15 finalists based on the quality of their presentations. The finalists will then get mentorship from industry experts. On top of this, they will get access to a CBDC development sandbox, which will enable them to develop prototypes of digital currency solutions swiftly.
Reportedly, the sandbox will feature an all-inclusive test and development platform, which includes a plethora of application programming interfaces (APIs). The selected finalist will then present their solutions to a global audience on demo day during the 2021 Singapore FinTech Festival. Out of the 15 finalists, up to three winners with the best solutions will walk away with $50,000.00 (£36,030.00) in prize money.