BIS identifies drivers of CBDC appeal for central banks

Improving the efficiency of payment systems is the main motivation for central banks of developing countries considering the introduction of CBDC. Such a finding is contained in the Bank for International Settlements (BIS) study.

Many emerging markets are engaging in #CBDC projects. Most are interested in developing digital cash, fostering financial inclusion and increasing competition, according to a survey of 26 economies. Read the survey summary and a set of country papers https://t.co/Ut0DN8B9OB pic.twitter.com/p0wViChhDx

— Bank for International Settlements (@BIS_org) April 14, 2022

The survey was conducted from 9 to 10 February. It involved the heads of 26 regulators, including the central banks of China, Brazil, Hong Kong, Mexico, the UAE, Saudi Arabia, South Africa, Turkey and Russia.

“Providing cash-like digital instruments and the growing popularity of private digital payment systems are the main reasons for considering issuing CBDC,” — according to the document.

Central banks also prioritise expanding access to financial services, cybersecurity risks, the potential reduction in the role of banks in the system, and spillovers from cross-border operations.

As potential barriers to CBDC adoption, officials cited insufficient financial literacy, infrastructure challenges, high costs, and the private sector’s low readiness.

As BIS head Agustín Carstens назвал central banks the best source of trust in money in the digital age.

In March, BIS, in collaboration with the central banks of Australia, Malaysia, Singapore and South Africa, разработал two prototypes of a platform for cross-border settlements with multiple CBDCs.

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