The South African Reserve Bank (SARB) has embarked on an exploratory study to investigate the benefits of issuing a Central Bank Digital Currency for general-purpose retail use.
According to a recent press release, the SARB will investigate:
“the feasibility, desirability and appropriateness of a central bank digital currency (CBDC) as electronic legal tender, for general-purpose retail use, complementary to cash.”
The SARB said that its exploratory study will focus on the issuance of a domestic CBDC that can be used by consumers in South Africa.
“The feasibility study will include practical experimentation across different emerging technology platforms, taking into account a variety of factors, including policy, regulatory, security and risk management implications.”
The study sets out to consider how the issuance of a general-purpose CBDC will feed into the SARB’s policy position. The SARB said that it is not alone in its studies, as a growing number of central banks are currently exploring the feasibility of CBDCs.
The SARB denied that its exploratory studies were in any way an indication of plans to issue a digital Rand in the near future.
The study is expected to conclude in 2022.