IMF Endorses “Extensive” Pilot Projects for PH CBDC

The International Monetary Fund (IMF) is advising several phases and “extensive” pilot projects for the central bank digital currency (CBDC) of the country, specifically for regulations, laws, and cybersecurity challenges that will encompass implementation.

In their November surveillance report, the IMF indicated that the Bangko Sentral ng Pilipinas (BSP) charter that was amended in 2019 permits the issuance of wholesale CBDC, the regulatory framework  “may need to be revisited to ensure governance and financial stability risks are addressed.”

The IMF mentioned that “An extensive period of developing proof-of-concept and learning from pilots could be a means to understand the technology, the implications of CBDC on policies, and build capacity,”

The report noted that several Asian countries have conducted several research and development on CBDCs, “no country in the Asia-Pacific region has launched a CBDC to date (because) the issuance of a CBDC is complex (and) most countries at an advanced stage of development have opted to launch pilots to gain practical experience.”

“The implementation of pilots does not imply near-term adoption but, more importantly, they can help understand the technology and gain a better understanding of policy implications while building capacity,” mentioned the IMF, stressing the CBDC pilots in Thailand, Korea, Japan, India, China, and Australia.

The BSP had stated that it is headed towards wholesale CBDC as opposed to retail. Currently, it is managing its Project CBDCPh which is looking into the potential risks and uses in large-value 24×7 payment transactions of CBDCs for both bank and non-bank entities.

Source: Manila Bulletin