The Bank of Russia has recently addressed concerns regarding the introduction of the digital ruble, emphasizing that the new Central Bank Digital Currency (CBDC) will not lead to inflationary pressures in the economy. As part of its draft guidelines for the unified state monetary policy from 2025 to 2027, the bank reassured the public that the digital ruble will not alter the existing mechanisms of monetary policy.
In a series of statements, the Bank of Russia made it clear that the introduction of the digital ruble will not increase the total money supply in the economy. Instead, it will primarily influence the demand for physical cash and funds held in bank accounts. The central bank reiterated its commitment to managing inflation, stating, “After the introduction of the digital ruble, the Bank of Russia will continue to target inflation.” The bank plans to maintain its current practices of liquidity provision to banks, thereby ensuring that monetary policy remains effective and stable.
While the digital ruble will not contribute to inflation, it is expected to modify the structure of the money supply. The Bank of Russia aims to develop a more robust payment infrastructure, enhancing the reliability and efficiency of monetary transactions. Importantly, the introduction of the digital ruble will not undermine the foundational principles of the banking system or the overall implementation of monetary policy.
The bank emphasized that the two-tier banking system would remain intact, allowing credit institutions to continue their essential roles in lending to the economy and managing the savings of the population. This clarity reassures citizens that traditional banking functions will not be disrupted by the digital currency.
Testing for the digital ruble commenced on August 15, 2023, with approximately 600 participants from 12 banks. This pilot program is set to expand significantly on September 1, 2024, as more banks and participants are brought on board. The Bank of Russia has expressed enthusiasm about this increased engagement, signaling a robust framework for the CBDC's future implementation.
Last month, Sberbank, Russia’s largest bank, confirmed its involvement in the digital ruble pilot program. Deputy Director Anatoly Popov announced that customer operations involving the digital ruble are anticipated to begin in 2025. This suggests that the digital ruble could soon be available for public use, with a projected official launch date set for July 2025.
The Bank of Russia's recent clarifications regarding the digital ruble are pivotal in addressing public concerns about its potential economic impact. By assuring citizens that the CBDC will not induce inflation or disrupt existing monetary policies, the central bank is laying the groundwork for a stable digital currency environment. As the pilot program expands and major financial institutions like Sberbank prepare for the digital ruble's introduction, the groundwork is being set for a transformative shift in Russia's monetary landscape. Stay tuned for further updates as the launch date approaches.
October 2024, Cryptoniteuae