The Bank of Russia has indicated that introducing a digital ruble will not disrupt the existing monetary policy framework. Recently, the central bank released a draft outlining the unified state monetary policy for 2025 through 2027. It clarified that the digital currency will not increase the overall money supply in the economy.
According to the Bank, even with the introduction of the digital ruble, its focus on controlling inflation will remain unchanged. The central bank said it would keep money market rates under its control through operations for liquidity. It suggested the demand dynamics for cash and funds in bank accounts might change. However, it assured that there would be no inflationary pressure.
Moreover, the bank explained that the emergence of a digital ruble would change the distribution of the money supply without expanding the overall supply. It pointed out that the demand pattern for operating balances in the cash and other funds in accounts may alter. However, it is affirmed that this would not cause any inflationary pressure.
Digital Currency Pilot Sees Participation from 600 Users
The central bank also said that the circulation of a digital ruble and the possible transfer of funds from conventional bank accounts to digital ruble accounts will not harm financial stability. On the other hand, the appearance of more payment mechanisms in the market is believed to strengthen and stabilize the payment system.
Furthermore, the bank stated that all the fundamental principles of the banking system would be preserved. The model of two-tier banking will remain intact, as credit institutions remain the primary borrowers of the economy and the managers of household savings.
Similarly, due to recent advancements, key Russian banks intend to offer their customers opportunities to operate with digital rubles. This includes creating digital ruble accounts, placing cash, and executing transactions through the new infrastructure.
Since mid-August 2023, the Bank of Russia has tested the digital ruble regarding real transactions. The first stage involved about 600 people from 12 banks who tried different features. From September 2024, the pilot will grow much more significantly to test the digital currency’s efficacy more effectively.
