The Bank of Zambia has said it expects to complete its study seeking to determine the feasibility of launching a Central Bank Digital Currency (CBDC), before the end of the last quarter of 2022.
Narrowing the Financial Exclusion Gap
The Zambian central bank has said it expects to complete a research study that explores the benefits of launching a central bank digital currency (CBDC) in Q4 of 2022. The bank, which has been weighing the pros and cons of creating a digital currency, says the findings of this study will help it to determine whether is it beneficial to launch the CBDC or not.
According to a Bloomberg report, the Bank of Zambia, like some of its peers on the African continent, wants to launch a digital currency because it believes this has the potential to narrow the financial exclusion gap and reduce transaction costs. However, before launching the CBDC, the central bank said it needs to understand the study’s findings.
“The results of the research will form part of the input in the policy considerations on whether to introduce a central bank digital currency in Zambia,” explained Nkatya Kabwe, the central bank’s acting director of communications.
Cryptos Not Legal Tender
Besides potentially boosting the participation of citizens in the formal economy, the report said CBDCs are likely to improve transaction traceability. They’re also likely to enhance the safety and efficiency of payment systems.
Meanwhile, the report that the Zambian central bank is set to complete its research into CBDCs before the end of the year comes a few days after it reportedly reiterated that cryptocurrencies are not legal tender. It added that “people who want to deal in them should have a clear understanding of all the risks that come with such payment and investment instruments.”
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