Page Comparison

Multicurrency Implementation

Oscar Correia

• Oscar Correia presented two potential models for implementing multicurrency functionality within the Payments Building Block:

  • Separate Currency Accounts: Each currency has its own dedicated account, simplifying accounting and compliance but potentially increasing complexity and liquidity management challenges.

  • Single Base Currency Account: All transactions are converted to a single base currency, streamlining account management and scalability but introducing challenges related to currency fluctuations, exchange rate management, and regulatory compliance.

• Mauree, Venkatesen suggested forming a subgroup with Oscar Correia and David Higgins to delve deeper into the integration of the proposed multicurrency models with existing APIs and identify necessary changes. The subgroup will also define the scope of multicurrency support and its application across different use cases.

• The subgroup will convene in the first week of September to discuss the integration of multicurrency capabilities into the Payments Building Block.

• David Higgins agreed with James Dailey that the end-to-end mapping of the flow is crucial for multicurrency implementation. He also highlighted the need to determine if the payments building block should handle the financial conversion or if a third-party FX transfer solution would be more suitable.

• Mauree, Venkatesen suggested that the diagram should be updated to reflect the current state of the payments building block, particularly considering the use of the MIFOS payment hub. He proposed collaborating with David to determine the necessary changes.

Mastercard proposal for Cross-Border Payments

Florian Greunz from MasterCard provided an update on the potential integration of MasterCard's Cross-Border Services platform with the Payments Building Block. He focused on two potential models:

• Model A: The government connects to the Payments Building Block, which then connects to a bank utilizing MasterCard's network. This model lacks a direct connection between MasterCard's platform and the Payments Building Block.

• Model B: The Payments Building Block directly integrates MasterCard's network, offering governments seamless access to cross-border payment capabilities.

The group leaned towards Model B as the preferred option, recognizing its potential to enhance the value proposition of the Payments Building Block by extending its capabilities to include efficient and transparent cross-border payments.

David Higgins questioned the possibility of batch instructions for scenarios like making multiple pension payments in a different currency. He also inquired about the payments building block's role, whether it should be a "dumb pipe" that passes transfers to MasterCard or have some decision-making capability.

Mauree, Venkatesen emphasized the need for the Payments Building Block to remain an open solution capable of integrating with various partners, ensuring flexibility and adaptability to different government policies and preferences.

Mauree, Venkatesen suggested circulating Florian's presentation to all members for feedback and scheduling a separate meeting with PSRAMKUMAR to get his input, as he was not present in the current meeting. She also proposed targeting the following week for the next working group meeting to allow time for the subgroup to meet and gather feedback