BRICS members are holding talks to connect their fast payment systems and central bank digital currencies (CBDCs), a move aimed at simplifying cross‑border transfers and encouraging greater use of local currencies in international trade, according to reporting by Reuters.
Technical link could alter how payments cross borders
Reserve Bank of India Governor Sanjay Malhotra outlined the discussions during an event in Mumbai, saying several options remain under consideration as member states prepare for the 2026 BRICS summit to be hosted by India. Reuters quoted Malhotra highlighting the potential to reduce costs in cross‑border payments.
"Cross‑border payments is an area of interest for all of us, including the BRICS, because we feel there is a lot of scope for reducing cost," Reuters quoted Malhotra as saying.
The proposals would involve both the technical integration of instant payment rails and interoperability between CBDCs issued by central banks in BRICS countries — Brazil, Russia, India, China and South Africa. The initiative remains at the discussion stage, according to the reporting.
What this means for South Africa
The proposals touch on several national priorities for South Africa's financial sector:
- Lower transaction costs — Connecting fast payment systems could reduce fees and time for businesses and individuals moving money across BRICS borders.
- Currency internationalisation — The move aligns with efforts to increase use of domestic currencies in trade, potentially reducing reliance on major reserve currencies.
- Technical and governance questions — Linking CBDCs raises issues around interoperability, oversight, data sharing and use of artificial intelligence in payment systems, all of which central banks must resolve.
Officials in South Africa, including the Reserve Bank, will need to consider how any technical architecture would interact with local regulation, anti‑money‑laundering controls, and the National Payment System. The reporting does not state a timetable or binding commitments; discussions are described as preparatory work for the summit.
Regional and global context
The BRICS proposal follows a global trend of central banks examining CBDCs and faster cross‑border payment solutions. Central banks are weighing tradeoffs between efficiency, privacy and financial stability as they pilot digital currencies and explore cross‑border linkages.
| BRICS member | Role cited in reporting |
|---|---|
| Brazil | Member state under discussion |
| Russia | Member state under discussion |
| India | Host of 2026 summit; RBI Governor outlined talks |
| China | Member state under discussion |
| South Africa | Member state under discussion |
The reporting also noted that central banks are discussing the role of artificial intelligence as digital payment systems become more complex. No detailed technical plan or formal agreement has been released publicly; the initiative is part of agenda‑setting ahead of the 2026 summit in India.
Next steps and implications
Key unanswered questions include:
- Which technical standards would govern interoperability between fast payment rails and CBDCs.
- How settlement, currency conversion and legal jurisdiction would be handled in cross‑border transactions.
- What governance arrangements would protect data privacy and meet anti‑financial crime obligations.
For South Africa, any BRICS decision to operationalise such links would carry consequences for exporters, banks, fintech firms and monetary policy. The detailed policy work and risk assessments remain the responsibility of national authorities and central banks, the reporting said.
Reporting on these discussions was carried out by Reuters and cited by international media; the initiative is still in the consultation phase and no firm commitments have been announced.
