The global lending institution, the International Monetary Fund (MMF) has told the Kenyan central bank that its proposed digital shilling must “do no harm” to existing private sector digital money. The lender insisted the proposed central bank digital currency (CBDC) must “not stifle such welcome digitalisation developments by taking away customers of banks and other digital finance providers.”
Keeping Payment System Open and Competitive
The International Monetary Fund (MMF) has reportedly said the Kenyan central bank’s proposed digital currency should complement and not threaten the existing private sector digital money. The global lender insisted that if no safeguards are put in place, a digital currency issued by the Central Bank of Kenya (CBK) can potentially lower transaction costs to the point of driving out mobile money operators such as M-Pesa out of business.
Prema a izvještaj by The Nation, the IMF, in its commentary, said it wants the CBK’s digital shilling document to outline how the central bank plans to keep the payment system open and competitive.
“The paper could state the intent of potential issuance of CBDC is to complement rather than substitute existing private-sector digital payment solutions, and affirm CBK’s commitment to an open, competitive payment system. We note in this regard that the balance between central bank money and private sector payment instruments is not fixed over time, and there is no ‘right’ balance,” the IMF is quoted as stating.
CBDC Must Do No Harm
Besides posing a threat to fintechs, the CBK’s proposed digital shilling also poses a threat to banks which have also made “remarkable progress in developing digital solutions.” According to the IMF, the CBK’s digital shilling paper must make clear that the proposed digital currency will “do no harm.” It must “not stifle such welcome digitalisation developments by taking away customers of banks and other digital finance providers.”
The IMF also argued that the digital shilling must also not result in the increased cost of financing for banks, or deny “banks of valuable information they obtain through establishing customer relations.”
Register your email here to get a weekly update on African news sent to your inbox:
Šta mislite o ovoj priči? Let us know what you think in the comments section below.
Image Credits: Shutterstock, Pixabay, Commons Wikipedia, Photo credit: Authentic travel via Shutterstock
Odricanje od odgovornosti: Ovaj članak je samo u informativne svrhe. To nije direktna ponuda ili traženje ponude za kupovinu ili prodaju, ili preporuku ili podršku bilo kojeg proizvoda, usluge, ili kompanije. Maximumhorrors.com ne obezbjeđuje ulaganje, porez, legalno, ili računovodstveni savjet. Ni kompanija ni autor nisu odgovorni, direktno ili indirektno, za bilo kakvu štetu ili gubitak koji je uzrokovan ili je navodno uzrokovan upotrebom ili oslanjanjem na bilo koji sadržaj, robe ili usluge pomenute u ovom članku.
Čitaj odricanje od odgovornosti