The Bank for International Settlements’ Innovation Hub, together with the Swiss National Bank and the World Bank, has successfully demonstrated how paper-based promissory notes can be redesigned using distributed ledger technology (DLT) through Project Promissa.
Promissory notes have long been used by multilateral development banks (MDBs) like the World Bank to track and encash multi-year financial commitments from member countries. However, the current paper-based system is complex, reconciliation-heavy, and time-consuming, despite representing a significant volume of pledged contributions.
Project Promissa developed a proof-of-concept (PoC) platform that tokenizes promissory notes, enabling streamlined management throughout their lifecycle — from issuance and signing to payment and archiving. This approach automates many manual processes, reducing operational burdens and cutting costs.
Morten Bech, head of the BIS Innovation Hub’s Swiss Centre, noted: “Project Promissa is a clear example of how blockchain can be used for the public good. The digital solutions tested by Promissa represent a significant step forward in modernising a long-standing, costly process.”
The DLT platform provides a single source of truth, allows for multiparty signatures, and guarantees confidentiality while preserving each party’s ownership and decision-making authority over its promissory notes.
Participants from seven countries took part in the testing phase, offering feedback to refine the platform.
Thomas Moser, alternate member of the Governing Board at the Swiss National Bank, added: “As the custodian of Switzerland’s promissory notes, we value the digitisation of our operations through DLT. Project Promissa offers a unique opportunity to modernise error-prone paper processes and establish a single source of truth, significantly reducing reconciliation needs and boosting efficiency.”