Users of Russia’s central bank digital currency will pay a fee for each transaction, a senior Bank of Russia representative recently announced. The cost of the digital ruble, however, will not exceed those currently applied to prompt payments in the country.
Bank of Russia to charge digital transfers in rubles
The Central Bank of Russia (CBR) is considering imposing fees on transactions with the digital ruble, revealed Kirill Pronin, director of the regulator’s financial technology department. The official stressed that these commissions will be lower than the current fees for transfers in the banking sector.
Speaking at a forum under the banner “Russian Banking System: Ensuring Availability of Services and Resources in the Face of Growing Risks,” Pronin further noted that the fees will certainly not exceed the costs of transfers with the Russia’s Faster Payment System (FPS). Quoted by the business news agency Prime, he said:
We assume that the fees on transactions with the digital ruble will be lower than the existing fees on wire transfers for market participants and certainly not higher than the commissions under the FPS.
Russia launched its faster payment system in January 2019. It allows Russian residents to send money using only a phone number and pay for goods and services with a QR code. Transfers up to 100,000 rubles per month (about $ 1,350) are free. A fee of 0.5%, but not more than 1,500 rubles (about $ 20), is applied to transfers exceeding this amount.
The Central Bank of the Russian Federation (CBDC) digital currency is still under development with experts working on its precise format. The digital ruble is expected to be implemented as a unique code, stored in a special electronic wallet, and become a full-fledged payment instrument alongside the ordinary ruble in its other two incarnations – cash and bank money.
Bank of Russia started considering a digital ruble in 2018 and decided to explore the possibility of issuing the CBDC last year. A consultation document was published in October 2020 to seek comments from financial sector players and other stakeholders. In April 2021, the authority released a digital ruble concept describing its main architecture.
In June, the monetary authority set up a pilot group joined by more than a dozen banks. CBR plans to complete the prototype of the platform in December 2021 and begin testing in January 2022. Elvira Nabiullina, the president of the bank, recently said that the digital ruble will provide Russian citizens with an alternative to cryptocurrencies. and fiat coins while enabling cheap and reliable payments. .
Do you think the Russians will prefer to use the digital ruble platform rather than the existing methods of money transfer? Tell us in the comments section below.
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