The digital hryvnia will start working in Ukraine: National Bank prepares for testing
17 February 2024 09:09
The National Bank of Ukraine plans to conduct open testing of the e-hryvnia by the end of 2024. Andriy Poddyeryogin, Head of the NBU’s Payment Systems and Innovative Development Department, revealed the details of the project during the Chronicle of the Economy podcast .
Andriy Podderiogin spoke about the second open experiment on the use of the electronic hryvnia (e-hryvnia) in Ukraine.
It is planned to make this pilot project open to everyone. Banking and non-banking institutions will have the opportunity to become NBU agents for the distribution, exchange, and use of e-hryvnia through their mobile applications.
The NBU is currently sending out invitations to banks to participate in the pilot project, and the amount of e-hryvnia to be issued will be determined after the number of participants is determined.
Thesecond experiment is scheduled to be launched in the second half of 2024 and is expected to last approximately six months.
During the experiment, everyone will be able to test the possibility of paying with e-hryvnia by exchanging it for cash and non-cash funds. The main goal of this experiment is to identify the demand for digital money among the population and determine the need for its introduction.
The NBU is also considering the possibility of implementing an offline mode for e-hryvnia payments and is planning to program the digital currency.
What is the e-hryvnia?
the e-hryvnia is an electronic form of the hryvnia that will represent a direct obligation of the National Bank of Ukraine. According to the regulator, its key purpose is to effectively perform all the functions of money, complementing the cash and non-cash forms of the hryvnia.
The use of the e-hryvnia should be convenient and accessible to all segments of the population, legal entities, government agencies, banks, and non-bank financial institutions.
The NBU is currently considering and working on the following possible options for using the e-hryvnia:
- e-hryvniafor retail non-cash payments – to make targeted social payments, reduce public spending on administration, and control the intended use of funds;
- e-hryvniafor use in the area related to the circulation of virtual assets, for example, for the exchange, securing of issuance and other transactions with virtual assets;
- e-hryvniato enable cross-border payments.
Digital money in the world
Central banks in many countries are currently considering the introduction of digital currencies – the so-called CBDC (Central Bank Digital Currency).
A total of 98 countries are introducing CBDCs in various forms. Of these: 11 countries have already launched digital currencies, 15 countries have implemented pilot projects, 26 countries have launched certain elements of the digital currency system, and 46 countries are exploring this issue.
