The governor of Russia’s central bank announced this week that the country’s first digital ruble settlements will take place next year. This new currency will be critical to Russia’s ability to withstand sanctions, an official told Russian lawmakers.
According to the Ministry of Finance’s approved Financial Market Development Strategy, the full launch of the digital ruble, Russia’s central bank digital currency (CBDC), should occur before 2030. However, the Central Bank of Russia (CBR) intends to begin testing it in settlements as early as 2023, according to Elvira Nabiullina, the CBR’s Chair. Tass elaborated, quoting her:
“We quickly created a prototype of the digital ruble, now we are already testing with banks. Next year, we will pilot settlements in the real economy.”
The CBR began digital ruble trials in January and announced the first successful transactions between individual wallets in mid-February. Five financial institutions are currently involved, and another seven banks will join the experiments in the coming months, which are expected to last until 2022.
Nabiullina insisted that the digital ruble will open up new opportunities for Russia, its citizens, and businesses. The government will use it to make targeted payments to certain sectors of the economy and society. Individual transfers will be free of charge, but payments for goods and services may be subject to a small commission of 0.4 – 0.7 percent.
In a speech to members of the lower house of parliament, the governor emphasized that the digital currency will play a special role at a time when Russia is subject to unprecedented Western sanctions. The CBDC is expected to facilitate not only internal Russian Federation settlements but also cross-border payments with its partners.
The head of the Bank of Russia expressed her hope that Russian legislators will pass the necessary legal amendments to pave the way for the commercialization of the digital ruble. Her call comes after First Deputy Governor Olga Skorobogatova emphasized the importance of moving forward with the digital ruble project earlier this week and assured the bank that the trials will not be delayed.
