Chiara Scotti: From magma to masterpiece - forging the future of cross-border payments

Keynote speech by Ms Chiara Scotti, Deputy Governor of the Bank of Italy, at the Reykjavík Economic Conference, organised by the Center for International Macroeconomics at Northwestern University and the Central Bank of Iceland, Reykjavík, 8 May 2025.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Introduction

As we gather here in Iceland, its breathtaking landscapes remind us of how beauty is shaped by the earth's slow but powerful forces. Tectonic plates shift almost imperceptibly – much like the progress we've long been seeing in cross-border payments.

Yet when these plates collide, the impact can also be dramatic – triggering volcanic eruptions, unleashing magma, and causing orogenic changes that reshape the terrain. In the same way, innovation can act as a sudden, transformative force, that can reshape and improve the existing payments ecosystem.

Innovations in payments have often been associated with technological progress. Major breakthroughs – or 'eruptions', to return to my earlier metaphor – have marked turning points reshaping the global payments landscape. Examples include the telegraph enabling wire transfers in the 19th century, electronic fund transfers in the 1970s and internet banking in the 1990s.

Fast payment systems (FPSs) have emerged as a powerful tool for improving the speed, efficiency and accessibility of domestic payments. However, cross-border transactions still largely depend on the traditional correspondent banking model and continue to record an unsatisfactory performance in terms of transparency, access, speed and cost.