Market Design

In this article, we explore how innovations such as CBDCs, Open Finance, and data technologies are transforming financial intermediation. We introduce a platform leveraging CBDCs to fund trade credit advances for SMEs, with credit assessments powered by AI and market data. The framework emphasizes the role of guarantors, smart contracts, and secondary digital loan markets, highlighting their importance in enhancing financial intermediation. Stability and reasonable returns are indicated through simulations, underscoring guarantors' significance. The article was presented at BACEN's workshop on the tokenization of finance.