Users of Russia’s central bank digital currency are going to pay a fee for each transaction, a high-ranking representative of Bank of Russia has recently announced. However, the digital ruble fee will not exceed current fast payment fees in Russia.
Bank of Russia will charge for digital ruble transfers
The Central Bank of Russia (CBR) is planning to impose fees on transactions with the digital ruble, revealed Kirill Pronin, director of the regulator’s Financial Technologies Department. Officials from the regulator’s Financial Technologies Department stressed that they will charge less than transfer fees in the banking industry.
Speaking at a forum under the banner “Banking System of Russia: Ensuring Availability of Services and Resources in the Face of Increasing Risks,” Pronin further noted that the fees will certainly not exceed the costs of transfers with Russia’s Faster Payments System (FPS). Prime business news agency quoted Pronin as saying the following:
The fees for transactions using the digital ruble are expected to be less than the existing wire transfer fees charged market participants, and certainly not more than the FPS commissions.
In January 2019, Russia introduced its Faster Payment System. Russian citizens can send money to their bank accounts using a single phone number. They also have the ability to pay for services and goods with a QR Code. You can transfer up to 100,000 rubles each month (approx. The cost of transferring up to 100,000 rubles per monthly (approx. Transfers exceeding $1,350 are subject to a 0.5% fee (around $20) but no more than 1,500 Rubles (about $20).
The Russian Federation’s central bank digital currency (CBDC) 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 regular ruble in its other two incarnations – cash and bank money.
The Bank of Russia began to consider a digital ruble in 2018. In 2018, the bank decided that it would explore the possibility of issuing a CBDC. In October 2020, a consultation paper was released to solicit feedback from stakeholders in the financial sector. A digital ruble was released by the authority in April 2021 that described its principles architecture.
A pilot group of over 12 banks was established by the Monetary Authority in June. CBR plans to complete the platform’s prototype in December 2021 and commence trials in January 2022. Elvira Nabiullina, the bank’s chair, recently stated that the digital ruble will provide Russian citizens with an alternative to cryptocurrencies and fiat-backed stablecoins while enabling cheap and reliable payments.
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