e-Cedi will enhance Ghana’s dynamic payment ecosystem – BoG

The Bank of Ghana (BoG) has proudly announced the successful completion of the inaugural Proof of Concept (PoC) under Project Digital Economy Semi-Fungible Token (DESFT), marking a significant milestone in the realm of cross-border transactions.

Developed in conjunction with the Monetary Authority of Singapore (MAS), this groundbreaking initiative showcases the seamless execution of a cross-border payment transaction utilizing digital credentials, specifically the eCedi and an approved stablecoin from Singapore.

Project DESFT, initiated in June 2023, embarked on its first phase with the creation and refinement of a trusted credential system. This system empowers Small and Medium-sized Enterprises (SMEs) to digitize crucial information such as credentials, licenses, certificates, and trade records into verifiable digital assets on a secure distributed ledger system. Such innovation enables potential trade partners and financial institutions to efficiently authenticate the integrity of such data.

Building upon this foundation, Phase 2 of Project DESFT, completed in April 2024, achieved a significant milestone with the successful execution of a cross-border trade between Ghana and Singapore. Leveraging the DESFT solution, Universal Trusted Credentials (UTC), a Singapore Stablecoin (xSGD), the recently piloted Ghanaian Central Bank Digital Currency (CBDC) eCedi, and the Purpose Bound Money (PBM) protocol, this milestone underscored the viability of utilizing the proposed Ghanaian domestic retail CBDC platform, the eCedi, in cross-border transactions.

"The successful execution of live transactions further validates the potential of the eCedi system for future interoperability with various cross-border credential and payment platforms," affirmed the BoG.

Speaking at the press launch during the 31st Africa Summit in Accra on Thursday, May 15, Mr. Kwame Oppong, Director of the FinTech and Innovation Office at the Bank of Ghana, emphasized the transformative impact of the prospective introduction of the eCedi on Ghana's payment landscape. He highlighted its potential to facilitate inclusive growth, foster innovation, and enhance consumer experiences while enabling Ghanaian Micro, Small, and Medium Enterprises (MSMEs) to participate in international trade cost-effectively.

"Project DESFT aims to empower SMEs in Africa to overcome significant barriers to international trade, such as establishing trust with overseas partners and accessing cross-border payments and supply chain finance support," remarked Mr. Oppong. "Through innovative approaches grounded in cutting-edge financial technology, we have crafted a reliable information exchange solution based on UTC standards and Semi-fungible Token technology. The successful execution of real trade experiments aligned with our objectives underscores the effectiveness of our efforts."

Moving forward, the next phase of Project DESFT will build upon these achievements, focusing on highly automated digital credential processes, programmable payments across multiple digital currencies, and enhanced support for supply chain finance.