The Bank for International Settlements (BIS) and the Group of Central Banks have successfully completed Project Mandala, which demonstrates automated compliance for cross-border transactions.
project mandala The study was conducted in collaboration with the Reserve Bank of Australia, Bank of Korea, Bank of Malaysia and the Monetary Authority of Singapore.
In line with G20 priorities, this initiative shows how building regulatory requirements directly into cross-border payment processes can make these transactions faster and more cost-effective.
The project reached proof of concept by automating compliance procedures and addressed a key challenge facing the global financial system: the need to comply with multiple regulatory standards across jurisdictions.
Mandala provides a streamlined approach to international payments by allowing transactions to pass the necessary checks before proceeding, ensuring you remain compliant while increasing efficiency.
Increase transparency and provide real-time reporting and monitoring capabilities for regulators.
The functionality of this system was demonstrated through two real-world use cases.
First, for cross-border lending between Singapore and Malaysia, Mandala facilitated real-time compliance monitoring, particularly regarding capital flow management measures (CFM) and sanctions reviews.
Another use case involving a capital investment transaction between South Korea and Australia involved automating sanctions screening for a financial institution and performing compliance checks on private securities transactions.
These examples highlight Mandala’s ability to support transparency and regulatory oversight without compromising transaction speed.
The project’s system architecture integrates both new digital asset frameworks and traditional financial networks such as SWIFT, allowing them to work within different financial infrastructures.
This adaptability also allows it to work with central bank digital currencies (CBDCs), strengthening its role in the current and future payments landscape.
Maha El Dimaki, Director of BIS Innovation Hub Singapore said:
“Mandala is pioneering a compliance-by-design approach to improving cross-border payments without compromising privacy or the integrity of regulatory checks.
We are optimistic about the potential of these early results to strengthen cross-border payments. ”
Dr Norhana Endut, Assistant Governor of Bank Negara Malaysia, said:
“Project Mandala has given us a glimpse into the future of cross-border payments. We have successfully demonstrated a potential solution that addresses key challenges in existing compliance processes and It paved the way for faster, safer and more efficient international trade.
This project will serve as a key building block to further advance cross-border payments. It will also strengthen our joint efforts to foster greater economic and financial integration while strengthening regulatory oversight capacity. ”
