Peru is looking to create a central bank digital currency (CBDC) to help improve its payment systems. The Central Reserve Bank of Peru (CRBP) recently released a paper which looks into the need, timing, and design of a potential Peruvian CBDC, leading to the first step of a five-step process. This comes after the country received technical assistance from the International Monetary Fund, and announced cooperation with India, Singapore, and Hong Kong to develop a CBDC.

Current barriers to financial inclusion, especially in urban areas and households without savings, are the driving force behind the potential development of a CBDC. The CRBP emphasized that increasing access and interoperability of existing payment systems will help reduce transaction costs and improve financial inclusion. Current Peru statistics on digital payments show an impressive 5-fold increase over the last 6 years which points out that the digital payments are on the rise.

To gain valuable insights on customer's behavior, the CRPB also released a 25-question survey which aims to understand customer preferences concerning a CBDC. It will also allow feedback on certain aspects of the design of the digital currency such as privacy and security.

The CBRP and International Monetary Fund are taking a practical approach when it comes to the design of this CBDC, with the focus on making it easier for an average customer to use the digital currency. This will ensure the best possible outcome when it comes to increasing the adoption of digital payments. This new technology has the potential to improve the payment systems in Peru and pave the way for a more inclusive and secure environment.



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