The South African Reserve Bank (SARB) has begun its study to investigate how a central bank digital currency (CBDC) would work for retail use alongside cash in South Africa. The country was one of the first to trail digital currency as part of project Khokha.
Retail CBDC is a digital form of cash. It aims to give the best attributes of both cash and electronic payments.
“The Objective of the feasibility study is consider how the issuance of a general purpose CBDC will feed into the SARB’s policy position and mandate,” said the bank in a statement.
The study will look at how a CBDC can be executed essentially across different tech platforms. It will consider various factors, including policy, regulatory security, and risk management implications.
The feasibility study expected to last until 2022. The SARB has, at this stage, did not decide to issue retail CBDC.
Various central banks around the world are exploring CBDC. From that, significant economics like China leads the way in terms of advancing their digital yuan trails. Central banks in the U.S., China, India, Europe, etc. have begun looking into the form of currency. Just a day before yesterday S.Korea opened bidding for a technology solution for its potential CBDC.
