The delays could be aggravated by difference in cut-off time and compliance requirements between different intermediaries. This is where the second solution comes in: a multi-CBDC common platform. A common ledger utilising distributed ledger technology can potentially act as the global settlement layer for participating banks. Wholesale CBDCs, which are direct liabilities of central banks, are well suited to be used on such a distributed ledger to support simultaneous settlement, or the exchange of two linked assets in real-time. 3/8  BIS - Central bankers' speeches  The Bank for International Settlements is exploring the setup of a multi-currency settlement network. In such a network, participating commercial banks will be able to transact with foreign counterparties without going through correspondent banks. They do this by exchanging directly with one another the CBDCs they have been issued, thereby reducing settlement time and cost. The BIS Innovation Hub is carrying out different multi-CBDC platform experiments across its Swiss, Hong Kong, and Singapore centres. Project Jura in the Swiss Centre is exploring the direct transfer of Euro and Swiss Franc wholesale CBDCs between French and Swiss commercial banks on a single distributed ledger platform operated by a third party. The project has examined how trades in tokenised assets and foreign exchange are settled using payment versus payment (PvP) and delivery versus payment (DvP) mechanisms. Project mBridge in the Hong Kong Centre is exploring multi-currency cross-border payment capabilities built on distributed ledger technology, through which multiple central banks can issue their own CBDCs and distribute them to participants.
Quality data is foundational in our fight against greenwashing and in enabling relevant stakeholders to make effective ESG-investment decisions. Third, it helps to catalyse green and transition finance flows. There is a significant gap between ESG data needs and the ESG data available. We need good data on firms' carbon footprint, historical carbon emission trends, and compliance with their respective transition targets. We also need data on the climate-related risks their physical assets are vulnerable to. But the ESG data acquisition process is often manual, tedious and costly. ESG data verification is at a nascent stage. This impacts the credibility of reporting. FinTech can be a key enabler in addressing these ESG data challenges. 5/8  BIS - Central bankers' speeches  Data acquisition. FinTech firms are offering solutions that connect directly via Application Programming Interfaces (APIs) to sustainability projects, such as waste management systems, to retrieve relevant environmental and energy consumption data more efficiently and directly. Data provenance. Distributed ledger technology is being explored to address the issue of verifiability and traceability in data. Data for reporting. FinTech firms are offering automated reporting tools while staying agile to adapt to various reporting standards. For example, Matter Analytics offers reporting solutions that help asset managers and banks automatically generate customised and comprehensive impact reports for their clients. FinTechs are providing financial institutions with good data and analytics to evaluate and compare ESG performance. For example, Intensel uses artificial intelligence to examine and monitor climate data and satellite imagery to identify financial risks related to climate change.