Understanding Project Nexus

Questions and Answers

What is the primary objective of Project Nexus?

To create a global currency for international transactions.

To standardize banking regulations across participating countries.

To develop security protocols for online banking transactions.

To enhance cross-border payments by interlinking domestic payment systems. (correct)

Which of the following countries is NOT mentioned as a participant in Project Nexus?

Malaysia

Thailand

Philippines

Indonesia (correct)

How does Project Nexus aim to improve the efficiency of cross-border payments?

By creating additional regulatory hurdles for payment systems.

By reducing the number of transactions between countries.

By increasing the transaction fees for sending money internationally.

By allowing one connection to the Nexus platform to reach all countries. (correct)

What was the role of the Bank for International Settlements (BIS) in Project Nexus?

To conceptualize and develop the initiative. Signup and view all the answers

What benefit does Project Nexus provide to payment system operators?

It reduces the complexity of interlinking with multiple countries. Signup and view all the answers

Which aspect of cross-border payments is Project Nexus NOT focused on improving?

International regulatory compliance. Signup and view all the answers

In how many countries does domestic payments currently reach the recipient in seconds?

Over 70 countries. Signup and view all the answers

What is the expected time frame for cross-border payments facilitated by Project Nexus?

Within 60 seconds in most cases. Signup and view all the answers

Which of the following payment systems is linked to India's Fast Payments System (FPS)?

UPI Signup and view all the answers

What challenge does Project Nexus specifically address for payment system operators?

The complexity of building connections with multiple FPSs. Signup and view all the answers

Study Notes

Project Nexus Overview

Project Nexus is an international initiative aimed at enhancing cross-border retail payments through the interlinking of domestic Fast Payments Systems (FPSs).
The initiative is conceptualized by the Innovation Hub of the Bank for International Settlements (BIS).
Countries involved include India, Malaysia, Philippines, Singapore, and Thailand.

Need for Project Nexus

The Reserve Bank of India (RBI) has been linking its Fast Payments System (UPI) bilaterally with various countries for Person to Person (P2P) and Person to Merchant (P2M) payments.
While bilateral agreements provide benefits, a multilateral approach is expected to enhance the international reach of Indian payment systems.
Currently, in over 70 countries, domestic payments can be made in seconds at minimal to zero cost.

Benefits of Project Nexus

Project Nexus aims to standardize connections between instant payment systems, streamlining the process.
Instead of creating custom connections for each new country, payment system operators can connect to the Nexus platform for broader access.
This single connection facilitates a wider network, enabling cross-border payments to be completed, often within 60 seconds.

Description

Explore Project Nexus, an international initiative led by the Reserve Bank of India aimed at enabling instant cross-border retail payments. This multilateral effort connects various domestic Fast Payments Systems globally. Gain insights into how this innovation is set to revolutionize the way we facilitate international transactions.