Central bank considering introduction of digital Belarusian rubles

MINSK, 17 September (BelTA) – The National Bank of the Republic of Belarus is considering the possibility of introducing digital Belarusian rubles. Deputy Head of the Research and Strategic Development Office of the National Bank of the Republic of Belarus (NBRB) Mikhail Demidenko made the statement during the roundtable session held to discuss prospects of introduction of digital currencies by central banks, BelTA has learned.

Mikhail Demidenko said: “The National Bank of Belarus has not decided whether the digital Belarusian ruble will be introduced or not yet. We are starting to look into the possibility. As a rule, central banks go through a long process before introducing a digital currency. Everything begins with the writing of the digital currency concept. This concept is discussed with commercial entities, representatives of the private sector, banks, and the expert community for quite some time. Then decisions are made on the optimal design of this currency and on whether a proprietary platform or an internationally developed platform should be used. Then a pilot project is launched. It involves a limited number of participants in order to determine advantages and disadvantages of the design. And only then the decision is supposed to be made whether the digital Belarusian ruble should be introduced or not.”

The official stressed that digital currencies of central banks represent the brightest phenomenon in the sphere of digital financial technologies. They represent a digital form of money issued by a central bank. According to the Bank for International Settlements, about 86% of the central banks are in various stages of the process of introduction of digital currencies ranging from research to testing. Pilot projects have been launched by the Bank of Russia, the National Bank of Kazakhstan, and the European Central Bank. China is already busy testing the digital yuan.

The NBRB representative noted: “The majority of the central banks' projects for studying digital currencies focus on domestic needs such as the improvement of the payment system and the resolution of problems of national payment systems. However, digital currencies can be considered as a mechanism for preparing for future technological changes and can function, for instance, as a tool to enter individual financial systems and improve the effectiveness of transboundary payments. Essentially we are talking about digital currencies being able to change the world's financial architecture to a degree.”

In his words, Belarus' financial system faces new challenges amid transformational changes caused by the vigorous ubiquitous introduction of digital technologies. The challenges include the need to comply with changing requirements of consumers of financial services, the need to help introduce innovations in the economy, improve the reliability, speed, and convenience of payments, increase the share of cashless transactions in the economy, and reduce the use of cash. “This is why the advisability of taking an attempt to determine the need to introduce the digital Belarusian ruble on our country's payment market is becoming obvious,” Mikhail Demidenko concluded.