Australian CBDC seems unnecessary right now, says Reserve Bank of Australia

Australian CBDC seems unnecessary right now says Reserve Bank of Australia

As nations jostle around to launch CBDCs, the possibility of an Australian CBDC has been rejected by the country’s central bank. The Reserve Bank of Australia has stated in its payment paper that it is in no rush to create a central bank digital currency since the Australian Dollar is performing well.

The payment paper further reiterates that the central bank is cautiously observing CBDC developments. At present, the bank does not see any immediate need to create an Australian CBDC. It adds that the country’s real-time payment system has excellent performance and meets the current demands of the Australian financial players. Thus, there’s no need for an Australian CBDC.

No need for an Australian CBDC

The Reserve Bank of Australia further says that cash usage for daily activities is declining across the nation. Australians are moving towards digital payments faster and banknote transactions are not popular anymore. The demand for banknotes increased temporarily during the COVID-19 pandemic and the bank has met the challenge successfully.

The payment paper mentioned how the bank is keeping a keen eye on major CBDC developments that are happening across the globe. It is exploring CBDC projects initiated in China, Canada, and Sweden through a research perspective.

In Sweden, the Australian central bank notes that cash transactions have declined successively over the past few years. Therefore, it was justified that Riksbank explores e-Krona. Canadian central bank is undertaking CBDC research to meet any financial eventualities.

RBA studying global CBDC projects

The paper further sheds light on Facebook’s Libra saying how the project hasn’t seen the light of the day, despite massive technical backing. It is following Libra-related developments to notice how it secures jurisdictional and regulatory approvals in various countries.

RBA has also studied the most elaborate CBDC project, Chinese digital Yuan. It says the project is currently in the testing phase and the Chinese government is promoting the digital currency via WeChat and Alipay wallets.

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Gurpreet Thind

Gurpreet Thind

Gurpreet Thind is pursuing Masters in Electrical Engineering at University of Ottawa. His scholarly interests include IT, computer languages and cryptocurrencies. With a special interest in blockchain powered architectures, he seeks to explore the societal impact of digital currencies as finance of the future. He is passionate about learning new languages, cultures and social media.

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