Thailand sets timeline for CBDC pilot project launch

The Bank of Thailand (BoT) will launch a pilot project to test a retail CBDC. According to regulator’s statement, the limited-scale tests will take place in the private sector.

“The BoT will assess the advantages and risks identified during the pilot project to formulate appropriate policy and improve the instrument’s design going forward,” said the press release.

The pilot is divided into two phases. In the first phase, the regulator will test the digital currency in basic operations such as payments for goods and services. Tests will take place on a restricted area with 10,000 users. At this stage, the experiment will involve Bank of Ayudhya, Siam Commercial Bank and 2C2P.

It is expected that implementation of the initiative will begin by the end of 2022. The tests will run until mid-2023.

In the second phase, BoT will test “innovative” use cases for CBDC. Business and public representatives will be able to submit their own concepts for retail use. The regulator will run a corresponding event from 5 August to 12 September 2022.

The central bank stressed that it does not currently plan to issue a retail CBDC, as officials need to assess the instrument’s advantages and risks for the financial system.

Thailand has been working on a wholesale CBDC project for several years. In April 2021, the country took first place in the PwC ranking’s corresponding category.

In the same month, BoT announced its intention in the second quarter of 2022 to launch testing of the digital currency for retail transactions. It seems these plans were later abandoned.

In May 2022, the government of Thailand exempted transfers of digital assets involving licensed cryptocurrency exchanges from value-added tax.

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