The Central Bank of Australia announced the interest of financial institutions in eAUD

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Reserve Bank of Australia (RBA) has received more than 140 proposals for a digital Australian dollar, but fears it will displace the government currency.

Deputy Governor of the Central Bank of Australia BradBrad Jones said that after the launch of a pilot program to test the digital Australian dollar (eAUD), central bank staff were surprised by the interest in this project. The regulator received feedback from more than 80 financial institutions proposing options for using CBDC in various industries, including e-commerce and payments. RBA researchers will experiment with the proposed options early next year and plan to publish a progress report in mid-2023.

However, the regulator fears thatThe government's stablecoin could displace the Australian dollar, causing people to avoid commercial banks. Jones said Australians' deposits in savings accounts now accounted for more than 60% of total bank balances. If people choose to store funds in CBDC, they will begin to withdraw money from banks en masse. As a result, banking organizations may experience liquidity problems because they will not have sufficient capital to lend to consumers. All this will complicate the RBA's monetary policy.

However, Jones suggested that digitalThe dollar still has certain advantages. The main ones are user confidentiality, fast transactions and reduced fees for payments. The RBA deputy governor added that the central bank will continue to issue paper notes as long as people consider them a public good.

A few years ago, the Central Bank of Australia announced that there were no compelling reasons to issue its own digital currency, since paper money was in great demand among local residents.