Kristalina Georgieva, president of the International Monetary Fund (IMF), said that central bank digital currency (CBDC) has the potential to replace cash, but it will still take time before it is truly implemented and widely adopted.
Kristalina Georgieva said at the Singapore Fintech Festival on Wednesday:
In island economies, CBDCs can replace costly cash distribution, in more advanced economies they can provide resilience, and in countries with large unbanked populations they can increase financial inclusion.
Kristalina Georgieva said that now about 60% of countries around the world are exploring CBDC in some form, and some countries have even studied CBDC in depth and begun to formulate regulations to guide the development of digital currency.
To this end, the IMF has specially released the "CBDC Handbook" to serve as a reference guide for policymakers around the world. The IMF also stated in June this year that it is studying the concept of a "global central bank digital currency (CBDC) platform" to facilitate transactions between countries.
Kristalina Georgieva mentioned that although there is "great uncertainty" in CBDC applications and the adoption rate is still very low, there is also endless room for innovation. she says:
Now is not the time to back down. The public sector should prepare for the future deployment of CBDC and related payment platforms. These platforms should be designed from the outset to facilitate cross-border payments, which are currently "expensive, slow and accessible to only a few."
According to a study conducted by the Bank for International Settlements (BIS) last year, 93% of 86 central banks surveyed said they were exploring CBDCs, while 58% said they might issue retail CBDCs in the short to medium term.
However, data from the Atlantic Council shows that as of June this year, only 11 countries have adopted CBDC, another 53 countries have entered the advanced planning stage, and 46 countries are studying CBDC.
This article was first published on "Blocker".