In a speech delivered in Singapore, the Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, has called on countries to take a more proactive approach in developing their central bank digital currencies (CBDCs). Georgieva emphasized the importance of the public sector offering guidance to ensure safety, and efficiency, and to counter fragmentation.
Eleven countries, including several in the Caribbean, as well as Nigeria, have already launched their CBDCs. Additionally, approximately 120 other nations are in the exploration phase, though progress and approaches vary widely, with some abandoning the idea altogether, reported Reuters.
“We may be at a point where the public sector needs to offer a little more guidance,” stated Georgieva. “Not to crowd out, not to disrupt, but to act as a catalyst to ensure safety and efficiency – and to counter fragmentation.”
To assist countries in this process, the IMF has released the first installment of a “virtual handbook” on CBDCs. This handbook is designed to aid nations in the design and setup of their digital currencies, ensuring that the new technologies are globally interoperable.
Supporters of CBDCs argue that these digital currencies will modernize payment systems by introducing new functionalities and provide an alternative to physical cash, which appears to be in a state of decline.
The push towards CBDCs comes at a time when the landscape of global finance is evolving rapidly, with countries seeking innovative solutions to enhance their monetary systems.