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20/06/24
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Iran’s Central Bank Announces CBDC Pilot
Two days ago, Iran’s central bank announced that a pilot scheme for its central bank digital currency (CBDC) known as the digital rial has been launched. According to the Central Bank of Iran (CBI), the public pilot is focused on domestic micropayments.
The pilot, scheduled to start tomorrow, will make digital rial available to banking customers as well as tourists on the island of Kish. Kish, which is the Persian Gulf’s second largest island, is also a well-known tourist destination. According to reports, Kish hosts almost twelve million visitors yearly and contains a free trade zone.
Three years ago, Iran’s former minister of information and communications suggested the transformation of Kish into a hub for local and global crypto exchanges.
The CBI said the digital rial’s public rollout on Kish Island is part of an expansion of the pilot program initiated last year. The pilot program will allow tourists and bank customers to use the CBDC for payment of services and goods, but they will need to scan a barcode.
“Unlike other types of electronic money commonly used in the country, which are used through bank accounts and common payment tools such as bank cards, the digital rial does not require interbank settlement to transfer funds between the buyer and the seller,” said the CBI.
Transferred funds will be sent immediately after completion. “Payment with this method is much easier than common card payment methods while increasing payment security,” said the CBI. The apex bank believes that the CBDC serves as the groundwork for developing the digital economy in Iran and considers it a response to the need to develop the payment space.
“Other important goals such as increasing resilience and stability in the country’s payment infrastructure, recreating the role of electronic banknotes in small payments in the country, improving the efficiency and developing new payment tools, and managing the risks caused by the spread of private money are also considered […],” reads the official announcement.
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