MAS Lays Foundation for Safe Use of Digital Money; Launches Digital Platform for Seamless ESG Data Access

Singapore, 16 November 2023 – The Monetary Authority of Singapore (MAS) presented today three initiatives to ensure the safe and innovative use of digital money in Singapore, namely:

a) blueprint outlining the infrastructure required for a digital Singapore dollar;
b) expanding digital money trials; and
c) a plan to issue a “live” central bank digital currency (CBDC) for wholesale settlement.

The three forms of digital money that MAS is promoting are wholesale CBDCs, tokenised bank liabilities, and regulated stablecoins.

MAS today published the Orchid Blueprint which sets out the technology infrastructure that would be required to facilitate digital money transactions in the future. The blueprint builds on learnings from the Project Orchid industry trials., and identifies the following infrastructure building blocks for the sound use of digital money in Singapore:

Settlement ledger – to record digital money transfers, with supporting features such as native programmability and atomic settlement of digital tokens.

Tokenisation bridge – to connect existing account-based settlement systems with ledgers compatible with tokenised forms of digital money.

Programmability protocol – to use Purpose Bound Money (PBM) as a common protocol to specify the conditions for the use of digital money.

Name Service – to translate between unwieldy wallet addresses and alternative name identifiers that are readable and meaningful for verification.

To test the broad applicability of PBM and digital money in Singapore, MAS will expand Project Orchid’s digital money trialsRefer to Annex B for a list of industry trials conducted under Project Orchid.. Four new trials will be undertaken with industry players to examine relevant infrastructure components and commercial models:

Tokenised bank liabilities: OCBC and UOB are exploring the feasibility of enabling tokens issued by one bank to be accepted for retail payments by another. This will be first trialled at the Singapore FinTech Festival 2023.

Wallet interoperability: Ant International, Fazz and Grab will be launching a pilot that uses the PBM concept to facilitate payments by Alipay users to GrabPay merchants. The PBM ensures that only verified Alipay wallet users can pay to eligible GrabPay merchants, with transaction limits to deter fraudulent activity.

Supplier financing: Amazon and HSBC are exploring the use of PBM in the tokenisation of payables from Amazon to merchants. This will help unlock liquidity for merchants, thereby improving merchants’ access to financing and working capital.

Institutional payment controls: J.P. Morgan is exploring the use of payment controls to enable a bank’s institutional clients to hold deposit tokens and transfer them to clients outside of the issuing bank’s direct customer base as long as the banks are part of an agreed trust ecosystem. This ensures adherence to controls set by the issuing bank and the recipient’s bank, enabling peer-to-peer transfer of deposit tokens which are traditionally non-tradeable liabilities.

To complement the digital money trials by the financial industry involving retail and corporate users, MAS will commence the development of CBDC for wholesale interbank settlement next year. MAS will pilot the “live” issuance of wholesale CBDCs for the first time, after previously simulating issuance within test environmentsAs part of Project Ubin, MAS issued a simulated wholesale CBDC which was used solely for payments within the banking system. It was not available to the general public. . The first pilot will involve the use of “live” wholesale CBDC to settle retail payments between commercial banks. Future pilots could include the use of “live” wholesale CBDC for the settlement of cross-border securities trade.

Mr Ravi Menon, Managing Director of MAS, said, “The “live” issuance of central bank digital money for use as a common settlement asset in payments is a significant milestone in MAS’ digital money journey that began in 2016. The issuance of wholesale CBDC reinforces the role that central bank money plays in facilitating safe and efficient payments.”

Digital Platform for Seamless ESG Data Collection and Access

MAS also launched Gprnt (pronounced “Greenprint”), an integrated digital platform that harnesses technology to simplify how the financial sector and real economy collect, access and act upon environmental, social and governance (ESG) data to support their sustainability initiatives.

Gprnt is the culmination of MAS’ Project Greenprint and offers an enhanced digital reporting solution for both large businesses and small and medium enterprises (SMEs) to seamlessly report their ESG information. This is currently undergoing live testing with selected banks and SMEs, and will be progressively rolled out from Q1 2024 onwards.

When fully implemented, Gprnt’s reporting solution is expected to help companies automate their ESG reporting process, and allow end users (such as financial institutions, regulators and large corporates) to access relevant data and timely insights to support their sustainability-related decision making.

Following its launch, Gprnt will expand its cross-border capabilities to better serve the more sophisticated data needs of larger multi-national entities and other regional economies. To achieve this, a new entity, Greenprint Technologies Pte Ltd, will be set up, with HSBC, KPMG in Singapore, MAS, Microsoft and MUFG Bank joining as strategic partners.

Automating ESG reporting for businesses

Gprnt will function as an inclusive and interoperable data layer that serves both businesses and corporates as well as financial institutions. It will simplify ESG reporting by enabling businesses to automatically convert their economic data into sustainability-related information.

Data collection: Gprnt will pursue integrations with a range of digital systems employed by businesses in their day-to-day activities. These include systems for utilities consumption, bookkeeping and payroll solutions, building and waste management, payments gateways, and networks for artificial intelligence of things (AIoT) sensors and devices.

These integrations will allow businesses to consent to the release of data via application programming interfaces (APIs), to enable Gprnt to help businesses compute their basic sustainability metrics in an automated and efficient way.

To make this data collection more seamless for businesses in Singapore, Grpnt will also enable the retrieval of relevant data from trusted government sources via Myinfo business, by using their SingpassRelevant government data entails businesses’ entity profile, water and electricity consumption data. Singpass accounts must be linked to a valid Unique Entity Number (UEN) in order for this data to be accessed..

Data computation: Gprnt will translate and compute source data into ESG-related outputs for businesses to report.

Where businesses’ source data is unavailable, the platform will provide AI tools such as intelligent document processing (IDP) to extract key data from user-uploaded documents.

A GPT4-powered chatbotThe capability is powered by Microsoft Azure’s OpenAI GPT4 model. will aid businesses in crafting their sustainability disclosures and recommending actionable insights.

The platform will cater for the mapping of sustainability metrics across key global reporting standardsSuch as the Global Reporting Initiative (GRI) standard, the Task Force on Climate-related Financial Disclosures (TCFD) framework, and in future the International Sustainability Standards Board (ISSB) standards. and automatic generation of basic sustainability reports from the middle of next year onwards. This reduces duplicative reporting for businesses that are required to adhere to different standards should their activities span multiple geographies and markets.

Data access: Businesses have the discretion to decide whom to share their ESG information with. These include:

Financial institutions, for purposes of obtaining green and sustainability-linked loans;

Industry partners, to access green business and supply chain opportunities;

Government or regulatory bodies, to fulfil climate reporting requirements or apply for sustainability-related grants; and

International platforms such as the Net Zero Data Public Utility , for businesses seeking to affirm their climate transition commitments at the global level.

Mr Ravi Menon, Managing Director of MAS, said, “Gprnt provides a key data bridge that can generate the trusted and high quality ESG data needed by the financial sector to more efficiently allocate capital towards green and transition initiatives. By harnessing generative AI and data APIs at scale, Gprnt will greatly simplify sustainability reporting for SMEs, and in doing so unlock the data needed by the public and private sectors to support SMEs’ sustainability journeys. Greenprint amply demonstrates how a regulator and the industry can come together to co-build technologies that enhance the quality and use of good data. I look forward to seeing how the new Gprnt platform will power the next bound of growth and innovation in the global ESG data landscape.”