Digital ruble pilot pushed to May
|Get all the essential market news and expert opinions in one place with our daily newsletter. Receive a comprehensive recap of the day's top stories directly to your inbox. Sign up here!|
(Kitco News) - The Bank of Russia’s plan to roll out its central bank digital currency (CBDC) pilot has just been delayed as the central bank has opted to postpone its launch until after the adoption of a comprehensive regulatory framework for the digital ruble, which is scheduled to happen sometime in late April or early May.
According to a Tuesday report from the state-owned TASS news outlet, the digital ruble pilot was originally supposed to start on April 1, but that date has been pushed back because the legislation related to the CBDC has only passed through the first reading in the State Duma, the Federal Assembly’s lower house.
Anatoly Aksakov, the head of the State Duma committee on financial markets, said that the central bank would be postponing the digital ruble trial since the legislative framework for implementation is not yet ready and the bank had no plans to implement it under the experimental legal regime. He said the digital ruble law is likely to be passed in April and will begin to operate in May.
While many private banks in other countries have expressed hesitation at the thought of integrating CBDCs, the banks participating in the digital ruble trial have expressed their eagerness to begin testing.
There were originally 15 banks scheduled to take part in the pilot, but that number has now declined to 13. Once the pilot launches, these banks will participate by supporting real operations with a limited number of customers.
Additionally, some of the banks’ employees would serve as test participants for CBDC retail payments, along with Ingosstrakh, one of the largest insurance companies in Russia. The general public will not be able to participate in the first stage of the pilot.
Vitaly Kopysov, the director of innovations at Sinara Bank, expressed his enthusiasm for the pilot and the benefits that smart contracts offer. “The use of smart contracts should reduce the operational load of banks and make the deals transparent, which not only will reduce the chances of the misuse of government and banks’ funds, but ultimately simplify the control over the existing contracts,” he said.
|Russia's Gazprombank wants a slower CBDC rollout, fears loss of revenue|
In preparation for the trial, officials at Sinara bank and Delobank have implemented the services required to start the pilot on their mobile applications for Android, including the ability to open a digital ruble wallet, replenish a wallet, receive information about the balance of the wallet, and a way to view the history of wallet operations.
“The main task of the digital ruble is to create new opportunities for the state and business,” said Kopysov. “Banks as financial intermediaries will receive a new infrastructure for transfers using the digital ruble, including cross-border ones. New services will be created, stimulating increased competition for customers in the financial sector.”
While the pilot has been delayed for roughly a month, it remains well ahead of its original launch date, which was planned to take place in 2024. The Bank of Russia moved up the timeline for the digital ruble launch in an effort to speed up the creation of a workaround to the SWIFT payments system amid Western economic sanctions against Russia.