Philippine central bank not ready to run CBDC

Philippine Central Bank Governor Benjamin Diokno announced that a "preliminary"Research by the central bank's digital currency research institution suggests that a lot more work needs to be done to make the digital peso a reality.

Over the summer, Bangko Sentral ng Pilipinas confirmed that it is studying the feasibility and potential policy implications of issuing its own CBDC, or the digital equivalent of a physical peso.

Reportedly at a press briefing by Diocnorejected the possibility of issuing CBDC at any time in the near future. To date, the study has shown that ongoing research is needed to explore capacity building and networking between other central banks and financial institutions.

So far, the bank's research has covered the mainCBDC-related issues, focusing on implications for monetary policy, legal frameworks, payment and settlement systems, financial inclusion and regulatory oversight.

The Governor said the CBDC study at BSPcould benefit from exploring private sector digital currency business models in the Philippines, as well as industry sandboxes. The central bank plans to study how to improve the country's existing payment system and leverage CBDC research from other central banks around the world.

The CBDC study in the Philippines comes amidA central bank digital payments transformation roadmap that aims to digitize over 50% of retail payments by 2023 and ensure that 70% of citizens have bank accounts by the end of the year.

According to BSP, ongoing CBDC research may require technical support from the International Monetary Fund and the Bank for International Settlements.

The central bank still adheres toviews that CBDC is superior to private digital currencies and indicated that its digital innovation will continue to evolve within the existing fiat currency framework.

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