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Bank of Russia chairwoman believes a digital ruble is a “natural move” in the financial system

Bank of Russia chairwoman believes a digital ruble is a “natural move” in the financial system

Quick take

1 minute read

  • Many central banks from all over the world are getting ready to develop and launch their own CBDC.
  • Russia is one country which is taking the initiative to design its own digital Rubel which is expected to reduce business costs however, it could also help cut profits for commercial banks according to the chairwoman of the bank of Russia, Elvira Nabiullina.

Many central banks from all over the world are getting ready to develop and launch their own CBDC (central-bank digital currency). Russia is one country which is taking the initiative to design its own digital ruble which is expected to reduce business costs however, it could also help cut profits for commercial banks according to the chairwoman of the bank of Russia, Elvira Nabiullina.

In a meeting on the 3rd of December of Opora Russia, an organisation of small to medium-sized companies, the chairwoman says that a digital currency like the Ruble could help undercut commercial bank profits from commissions and transaction fees.

On top of this, she went on to say that a CBDC is a natural development when it comes to streamlining financial services. She added:

“This is a natural move in the financial system development: financial intermediaries should become less burdensome for the economy and earn money with new products and services instead of profiting from its monopoly and lack of alternatives [...] We believe that small and medium-sized businesses should definitely benefit from this.”

She even went on to say numerous benefits that could come from designing a CBDC in Russia adding:

“We are now considering several models in which the digital ruble can exist, in which the interaction of clients, the central bank, and commercial banks are organized in different ways, but these advantages remain in all models. These are fast, reliable and secure payments.”

As previously mentioned, many central banks all over the world are looking into the potential of developing their own central digital currency. China is at the forefront of this as it creates its digital yuan in the nation set to be the first CBDC project to launch in the world.

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