Thai Central Bank Not In A Rush
It has been a while since the Thai central bank namely The Bank of Thailand revealed its plans of launching an official digital currency. The Bank’s developers of official digital currency had been long working on the project.
Although it was announced recently that the digital currency project has been in its final stage, its launch was expected soon.
Now on 31st October, the Bank of Thailand has made an announcement. In the announcement, the bank has revealed that it is examining the risks and other factors associated with the pilot launching of Central Bank Digital Currency (CBDC).
The bank further said that it requires more time in the CBDC’s pilot launch. However, prior to the launch, there are some unfinished developments that are to be taken care of.
According to BOT, the bank wants to ensure that the CBDC project is able to provide extra advantages to the national economy with regard to risk management. BOP is hoping national CBDC would be beneficial for the existing financial system.
Globalization of CBDC Projects
There are several banks in the world that are currently working on developing their national CBDCs. Out of them, a few have launched CBDCs, while some are in the process of development and others have launched pilot testing.
For Thailand, the Governor of BOT namely Sethaput Suthiwartnarueput expects that a period of five years at least is required to finalize CBDC project. He said that we do not want to rush things and ignore risk management issues.
He further said on Friday that BOT is in the process of examining the risks and benefits emanating from the CBDC project. He also said that they are also looking at whether CBDC would be bringing any benefits for Promptpay.
Promptpay is a widely used digital payment system in Thailand.
The Governor emphasized that they have to be careful because CBDC has the potential to putting a massive impact on the national economy and financial system. He said that the project has to be beneficial for everyone.
Collaboration for Pilot Testing
Currently, BOT has partnered with the country’s three major banks and more than 10 thousand vendors for the purpose of launching limited-scope pilot testing.
During the pilot testing, CBDC will also be tested for purchasing and acquiring goods and services. The testing is expected to take place in specific areas of Thailand prior to the end of 2022.
Innovative services and unique uses of CBDC too have been in the pipeline of BOT’s pilot launching.
Furthermore, BOT has also been contributing to Mbridge project. This project is in the process of launching an entirely different digital currency which shall be used as wholesale currency.
Along with BOT, the other participants in that project are Hong Kong’s Monetary Authority, the central banks of China, and UAE.