India is set to push a proposal to link central bank digital currencies (CBDCs) across BRICS nations to make cross-border payments faster and more efficient at the bloc's upcoming summit in New Delhi, according to a Reuters report.
The proposal comes as India chairs BRICS this year, with leaders of the expanded 11-member grouping scheduled to meet in New Delhi on September 12 and 13. The Reserve Bank of India had proposed linking members' official digital currencies earlier this year.
As per the report, the plan could allow countries to use their respective CBDCs for bilateral trade settlements, potentially reducing payment costs and reliance on traditional banking channels. However, officials expect the proposal to face both technical and political challenges.
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BRICS countries have previously discussed improving interoperability between their payment systems. The bloc's 2025 declaration in Rio de Janeiro called for greater connectivity between national payment systems to facilitate cross-border transactions.
Creating a functioning CBDC network, however, would require countries with different financial systems and regulatory frameworks to agree on common technical standards. Previous attempts to develop shared BRICS payment infrastructure have made limited progress.
Geopolitical tensions could add another obstacle. Iran and the UAE have strained financial relations, while India remains cautious about deeper financial connectivity with China because of national security and trust concerns. India recently stalled a proposal to link China's Alipay+ with its instant payments system over security and data concerns.
If agreed, the initiative could become one of the most significant financial cooperation proposals at India's BRICS presidency.
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