Thailand’s central bank will not rush the launch of its digital currency as it is not yet sure what benefits it will bring. According to the head of the monetary authority, developing state-issued money can take several years.
Thailand’s Central Bank Wants to Better Understand Risks of Central Bank Digital Currency
The Bank of Thailand (BOT) intends to take more time to complete the development of its Retail Central Bank Digital Currency (CBDC). The monetary regulator wants to ensure that this version of the national fiat currency, with sufficient risk management, offers additional benefits for the country’s financial system.
Several central banks, including Thailand’s, have developed retail CBDCs but have yet to implement them fully, the Bangkok Post noted in a report. According to BOT Governor Sethaput Suthiwartnarueput, quoted by the daily, the development of retail CBDC is expected to take more than five years.
On Friday, the senior executive explained that the bank would like to understand better the benefits and risks of CBDC for retail customers and, specifically, whether there are additional benefits related to Promptpay, the country’s digital payment system.
The central bank has not yet seen this, the governor commented. Sethaput also emphasized that a digital currency should transform the country’s financial system and benefit everyone. The Bank of Thailand works with three financial institutions and around 10,000 consumers for limited-scale testing. Your digital currency in real applications. As part of the pilot project, the CBDC will be used for cash payments for goods and services during the test phase, which is expected to start at the end of this year.
The BOT is also considering innovative use cases and new financial services. In parallel, the Central Bank of Thailand, as a participant in the Mbridge project, has been working on the development of a wholesale digital currency together with the Hong Kong Monetary Authority, the Central Bank of the United Arab Emirates, the People’s Bank of China and the Bank for International Settlements. The multi-CBDC distributed ledger platform aims to facilitate cross-border payments using government-issued digital currencies. The group has already completed the first pilot of the project.