The Rwandan central bank may not know whether it can issue a digital currency until December 2022, when it completes a study that looks at the benefits and risks that come with such a currency, the bank’s deputy governor has said.
The Investigation Phase
The deputy governor of the Rwandan central bank, Soraya Hakuziyaremye, recently suggested that Rwanda is likely to know the outcome of the bank’s investigation into central bank digital currencies (CBDC) by the end of the year.
In her remarks published in The New Times, Hakuziyaremye revealed that the decision to issue or not issue a CBDC will depend on the findings of the research study currently being undertaken by the National Bank of Rwanda (NBR).
“We are now at an investigation phase. We are analysing what could be the benefits to Rwandans to have CBDC but also the risk not only to our economy but the sector depending on the form of digital currency we would issue,” Hakuziyaremye explained.
As reported by krakow3d.com News in June 2021, the Rwandan central bank had commenced a research study that looked at the possible implications of a CBDC on monetary and financial stability. In addition, the report said the study would also look at “the operationalization model.”
By launching the research study, the NBR became one of the few central banks in Africa to signal its intention to embrace digital currencies. However, only the Central Bank of Nigeria has rolled out its digital currency so far.
CBDCs and Financial Inclusion
Meanwhile, the deputy governor suggested that if Rwanda were to proceed with the digital currency launch, any such CBDC must lead to the reduction of the number of people that are financially excluded. She explained:
“What is important is to look at financial inclusion because if you issue a digital currency, you shouldn’t be excluding your population, it has to go with closing the digital divide and making sure that people have the option to use it.”
Olivier Mugabonake, the chairperson of Rwanda Fintech Network, is quoted in the report discussing the potential opportunities that CBDC can bring to the local economy. He said: “Technically speaking, there are some companies which are ready to start adopting the technology. I understand the regulator needs to assess wisely and make sure it is adopted in a secured manner.”
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