Russia is preparing to launch a pilot for its Central Bank Digital Currency (CBDC); the digital ruble, this April in connection with a dozen banks as a part of the project.
The Central Bank of Russia’s (CBR) – which is behind the CBDC project – primary objective for the digital ruble is to foster peer-to-peer transactions across the country that will commence 1 April with real transactions via a select number of citizens.
Select service companies will also have the opportunity to interact with the digital ruble, according to Deputy Governor Olga Skorobogatova, with up to 13 banks working with “real people” on “real transactions” once the pilot commences.
The Deputy Governor did note however that the initial number of transactions will be limited and are only available for the selected few.
The CBR will also look into methods to scale up the CBDC with participating banks, working on operations such as technical and operational usage.
VTB Bank’s Chairman Anatloy Pechatnikov – a collaborator on the CBDC project – said the digital ruble will provide a “high level of security, will be understandable and will not require special training among clients”.
He continued: “VTB is moving ahead of its initial schedule with its digital ruble launch. We have tested operations with digital rubles and the purchase of digital financial assets for digital rubles.
“This year we plan to test operations with Friends & Family, which means our bank’s employees, they are the ones who will start paying with digital rubles in practice,” he clarified.”
Plans to integrate a CBDC in Russia were announced in October 2020 and a prototype had been built and completed by December 2021, leading to a full launch being targeted in 2024.
Due to numerous sanctions from Western governments and companies as a result of its ongoing war with Ukraine, Russia has accelerated plans to initiate its CBDC so as to allow its citizens a quicker and more seamless transaction process.
Reports also suggest that Russia is also launching its pilot of the digital ruble to reduce its dependency on the US dollar.