Digital ruble consultation paper: public discussion ongoing
A discussion hosted on Monday by Forum Analytical Center has become another event in a series of meetings with financial market players dedicated to the key points of the Bank of Russia consultation paper ‘A Digital Ruble’. Similar consultations were previously held with payment system and Russian FinTech Association representatives, payment industry experts, and macroeconomists.
‘It is vital to ensure that all stakeholders are involved to the full in the early stages of a digital ruble rollout so that the final result meets market requirements of today and tomorrow. The key focus of a digital ruble would be making settlements and payments cheaper and more secure’, said Sergey Shvetsov, First Deputy Governor of the Bank of Russia.
The Bank of Russia intends to consider the discussion outcomes when it works out a digital ruble concept, so that they lay the groundwork for a platform and a pilot project to be tested on a limited number of users. Based on these results, the Bank of Russia will make a decision as regards the advisability and stages of the digital ruble rollout. ‘The absolute majority of discussion participants have basically spoken out for the necessity and feasibility of a digital ruble, and almost all agreed that this is a third substance, a third form of money’, said Olga Skorobogatova, First Deputy Governor of the Bank of Russia. ‘It is certain to have implications for business model of players, major or medium-sized and small. We also look to other market players to become involved in the advancement of a digital ruble. This is what this project is about: a tokenised ruble would bring into life new services and online payments involving all market players, taking the quality of settlements to a whole new level.’
The project is key to developing both financial and non-financial services, according to the discussion participants, who believe a digital ruble would make ‘smart money’ with the benefit of marking — a labelling technique to help check if the funds are spent on intended projects and not inappropriately. These properties of digital rubles would be particularly relevant for smart contracts, among other things.
Another key issue under discussions was the availability of this new form of money to consumers and financial market players. Almost all discussants agreed on the need for equal access. In the course of project implementation, convenience and a seamless nature of digital ruble conversion into other forms of money and back should be guaranteed, as well as the simplest customer identification procedure in digital ruble payments, noted discussants.
The consultation paper envisions four models for how a digital ruble could be launched. Financial market players are currently inclined towards two of them, viz. C and D — those assigning the key role to financial intermediaries.
The Bank of Russia intends to use other platforms for follow-on project discussions, including one on a State Duma platform. Business representatives said they were willing to take part in both subsequent discussions and the pilot project.