The Russian parliament has taken a significant step towards implementing its central bank digital currency (CBDC) project with the passing of a “digital rouble” bill. The lower chamber of the Russian parliament, Gosduma, approved the bill in its third reading on July 11. The document now awaits confirmation from the higher chamber and subsequently, the President’s signature.
The bill, which underwent its last amendment at the end of June, establishes legal definitions for terms such as “platform,” “participants,” and “users,” as well as providing general guidelines for the CBDC ecosystem. Under the current framework, the Central Bank of Russia (CBR) will act as the primary operator of the digital rouble infrastructure and will be responsible for safeguarding all stored assets. The main objective of the CBDC, according to the CBR, is to serve as a means of payment and transfer, meaning users will not be able to open savings accounts. Individual customers will enjoy free payments and transfers, while corporate clients will be charged 0.3% of the payment amount.
Introduced to Gosduma in December 2022, the bill passed its first reading in March 2023. In February, Gazprombank, a subsidiary of the leading Russian government-owned gas company, expressed concerns about potential risks for banks if there is a rapid transition to digital money. McKinsey’s Russian branch estimated that traditional banks could suffer losses of approximately $3.5 billion (250 billion rubles) over five years due to CBDC implementation, but retailers could see an annual profit of $1.1 billion.
Olga Skorobogatova, the deputy chairman of the CBR, recently announced plans for the mass rollout of the “digital rouble” to all Russian citizens between 2025 and 2027. The CBDC will undergo testing in a pilot regime during 2023 and 2024.
This development in Russia’s digital currency plans has implications for multiple sectors, including finance and economy, government regulation, and the cryptocurrency industry. It signifies Russia’s commitment to exploring the potential of CBDCs and providing an alternative payment and transfer method for its citizens. As the bill progresses through the remaining legislative stages, the implementation of the “digital rouble” draws closer, bringing the country closer to joining the growing global trend of CBDC adoption.