Within three years of the digital ruble’s launch, between 2 trillion and 4 trillion rubles held in banks could move into it. This was disclosed by Sberbank Deputy Chairman Anatoly Popov, according to RBK.
“There is currently no large liquidity surplus in the market; liquidity is balanced. These same funds (2–4 trillion rubles) will no longer be available for lending, which will ultimately lead to a liquidity deficit and, consequently, to higher rates,” he said.
Popov noted that moving around 10% of cash and non-cash funds into the digital ruble would push lending rates up by about half a percentage point.
According to the National Financial Market Council (NFMC), introducing the digital ruble as a replacement for cash and non-cash money, rather than via additional issuance, could lead to banks’ liquidity losses.
The NFMC believes that a liquidity deficit would necessitate constant external substitution sources. This could undermine banks’ market resilience, “especially those without state participation,” and, therefore, reduce the level of competition.
The NFMC proposed placing limits on operations with the digital ruble.
“Introducing restrictions on the use of digital rubles (including temporary ones in the early stages of deployment) will allow banks to forecast and assess future changes in liabilities,” the NFMC noted.
Earlier Moody’s analysts warned of a possible outflow of banking capital due to the digital ruble.
In October, the central bank began public discussions on launching the digital ruble, releasing a dedicated report.
Central Bank head Elvira Nabiullina noted that the digital ruble could affect banks’ business models.
VTB President Andrey Kostin said that issuing the new asset risks the transfer of part of banking business to the Bank of Russia.
A detailed analysis of the central bank’s report on the digital ruble is in ForkLog’s exclusive.
Accessibility and traceability: how the Bank of Russia sees the digital ruble
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