Russian Lawmaker Backs CBDC To Displace Private Banking Sector
Russian Deputy Prime Minister Maxim Akimov has reportedly proposed the launch of a central bank-backed digital currency (CBDC) to help replace Russia’s traditional banking sector.
In comments reported by Russian outlet TASS, Akimov proposed a shift away from the current banking structure in Russia, which is often seen as slow and sometimes unreliable. The law maker suggested that the Russian central bank, the Bank of Russia, should begin to issue a state-backed CBDC which would supplement, and potentially even eventually replace, commercial banking services.
While it is unclear currently which technology the CBDC would be based on, Akimov wanted it to help bring the population closer to technological advancements, noting that “the whole of the population should be provided with digital financial services”.
This would expand financial services to all parts of the country, further increasing their access to financial instruments and allowing for better control of the country’s finances. It would also potentially increase competition in the banking space, allowing for more economic mobility.
The move would face several challenges however, including the possibility of pushing banks out of business and the potential cost of introducing the technology. Implementing a central bank-backed digital currency would also open Russia up to criticism from its international counterparts, who have historically been wary of Russia’s political direction when it comes to technology and finance.