Fitch: CBDCs will strengthen oversight of the payments sector

The introduction of central bank digital currencies (CBDCs) will bring benefits, but may disrupt the functioning of the financial system. These conclusions are contained in the report by the Fitch rating agency.

Among the advantages, analysts cited digitisation of operations, financial inclusion, strengthened oversight of the payments sector, and the fight against oligopolies of private companies.

The emergence of new payment instruments will intensify monitoring of AML/CFT compliance. Authorities will gain a new tool to implement stimulus programmes or provide aid in the event of natural disasters, the experts added.

Fitch attributed the risks of launching national digital currencies to a sharp outflow of funds from bank deposits into CBDCs. In the experts’ view, this would weaken the role of banks as financial intermediaries. Analysts also noted cybersecurity threats.

According to Fitch, active research and the launch of pilot projects indicate the imminent appearance of digital currencies.

PwC named the Bahamas and Cambodia as leaders in developing retail CBDCs.

According to Raiffeisenbank, by 2025 10% of countries will implement their own digital currencies.

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