The National Bank of Ukraine is working on a pilot project to introduce a digital e-hryvnia. This will be a third, alternative form next to cash and non-cash. Deputy Head of the NBU Oleksiy Shaban reported this in an interview with CES.
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According to him, the regulator has not yet made a decision on the start of issuing the digital hryvnia. The law on payment services contains an article that introduces a new form of national currency – e-hryvnia along with cash and non-cash.
Not electronic, but digital money
“I will start with the remark that it is not electronic money, but digital money. Electronic money is somewhat different in nature, and the goal, probably. Now the hryvnia can be digital. We are not saying that this will be the only type of currency, and the citizen can decide for himself whether to use it or not. If you don't want to, don't use it. The third form of the hryvnia, an alternative one,” Shaban said.
He added that with the development of digital assets and the digital economy, it is understood that the payment instrument and what is being sold must be of identical nature.
Use of e-hryvnia
Digital money may provide programmability, such that a payment occurs automatically under certain conditions.
For example, government support programs. Money from “eVidnovlennia” can be spent on building materials. And with “eKniga”, you can only buy a book. Now banks solve this by opening different accounts or issuing different cards.
“But if, for example, in the store's admin panel certain goods are coded: these are building materials, and these are books, then it is much easier if this money has a note that it can only be used to pay for building materials. Then you can't pay for a Snickers or a Coca-Cola with this money,” Shaban said.
After the merchant receives the targeted hryvnias, the targeted mark on his wallet is cancelled, and he can then use these funds as usual cash and non-cash funds.
“This is a symbiosis of something non-cash and something analogous to cash with a direct demand to the central bank,” he added.
When will the e-hryvnia be introduced?
Shaban noted that the National Bank plans only to pilot certain technological aspects and to confirm or refute certain hypotheses.
“We want to do this in an open environment, that is, with real participants, both wallet owners who will spend these pilot hryvnias, and merchants who will accept these hryvnias, and we will look for those who are interested in testing,” he said.
According to him, the NBU is currently looking for a technology provider that will help implement such a platform.
“We are working and confirming the interest of several Ukrainian banks to be participants in this project. We are moving forward, this is a study,” Shaban added.
Let us recall
In January, the Ministry of Finance wrote that the NBU was preparing a pilot project to introduce the e-hryvnia.
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