The Bank of Thailand (BOT) plans to test digital currency to the public in the second quarter of 2022 as a payment alternative. It was announced last Thursday.
By Ms. Wachira Aromdee, a qualified person (Assistant Governor) Bank of Thailand releases study on Retail CBDC impact on Thai financial sector and the results of public opinion polls Continue the retail CBDC development guidelines through the report “The Way Forward for Retail Central Bank Digital Currency in Thailand” published on April 2, 2021 to consider the guidelines for the development of Retail CBDC and pilot testing. The important things are as follows:
Study on the impact of Retail CBDC on the Thai financial sector
The results indicated that Designing and Optimizing Retail CBDCs must not have a severe impact on the transmission of monetary policy How the financial institution system works and overall stability of the Thai financial sector It will have the following important characteristics:
- cash-like format and does not pay interest
- Relying on intermediaries such as financial institutions in the Retail CBDC exchange with the public; and
- There are conditions or periods for many Retail CBDC exchanges to avoid competing deposits or the rapid migration of large deposits from financial institutions. This will affect the acting of an intermediary in receiving deposits and lending. including liquidity management of the financial institution system
The Bank of Thailand estimates that the population’s demand for Retail CBDC will increase gradually and that Retail CBDC will become an alternative payment option. It may be used to partially replace cash and e-money in the future.
Public opinion poll results
From the survey results, most agree with the Bank of Thailand’s retail CBDC development guidelines and view it as an important infrastructure contributing to the development of safe financial innovations. It is open to future access and competition. It also agrees with the Retail CBDC design approach above to limit its negative impact on the Thai financial sector.
Some of the survey findings further suggest that the Bank of Thailand focuses on promoting consumers’ understanding of the benefits and uses of Retail CBDCs, especially how they differ from electronic payments today.