On Friday, Olga Skorobogatova, deputy governor of the Bank of Russia, said that the country’s central bank digital currency (CBDC), the digital Ruble, is ready for its pilot phase. The bank is preparing to roll out the consumer pilot on April 1, 2023.
During a fintech conference in Russia, the deputy governor told the media that the project would be launched for peer-to-peer transfers between individuals and retail purchases. She also said that the pilot would be working on a limited number of operations.
The pilot will work on real operations for real people, but only for a limited number of them, with the 13 banks that have signaled they’re ready.
Skorobogatova also revealed that the Russian central bank would pilot the CBDC with sets of selected clients. Sources suggest that the bank will decide how to expand its project following the pilot.
Notably, Russia’s CBDC project has been going on for a while. The Russian central bank first proposed a CBDC project in October 2020 by publishing a consultation paper highlighting the potential designs of a digital Ruble.
The pilot was expected to go live in 2021 but provoked concerns in the national banking sector. The burdens primarily mentioned that the digital Ruble would be burdensome for lenders and make the banking system more centralized and less diverse. Upon this, the central bank promised to modify the concept, so it didn’t hurt the traditional financial system.
In August last year, the central bank published a study according to which the Russian CBDC could be used by 2024 to link financial institutions to the Ruble’s digital platform and to “expand the number of payment choices and transactions available using smart contracts.”
The Bank of Russia expects non-banking financial institutions and exchanges to use the new digital money by 2025. According to the central bank, the CBDC is anticipated to lower settlement and transaction costs compared to currently used techniques.
Following the sanctions placed on Russia, the nation has placed high hopes on its CBDC to end the dominance of the American dollar in the international market. In a visit to Cuba, Boris Titov, commissioner for entrepreneurs’ rights under the Russian president, said that the governments of both nations are looking forward to using Russian rubles and cryptocurrencies to facilitate cross-border cooperation.