Consultation begins on New Zealand's digital currency
The Reserve Bank (RBNZ) is opening consultations on the implementation of a central bank digital currency, referred to as “digital cash.”
This new form of money would exist alongside traditional banknotes, coins, and electronic bank money, providing a government-backed digital option available to all New Zealanders.
Benefits and features of digital cash
Ian Woolford (pictured above), director of money and cash at RBNZ, outlined the purpose of digital cash.
“Digital cash would ensure that central bank money is available to all New Zealanders and able to be used digitally,” Woolford said. “It would also help enable a money and payments system that is innovative, competitive, and contributes to the development of New Zealand’s digital economy.”
He added that this digital form of currency would support the fintech sector, enhancing competition and innovation.
Accessibility and privacy concerns
Digital cash would allow individuals and businesses to make payments online, in-store, or even small daily transactions such as pocket money, without the need for a commercial bank account. Importantly, it would operate independently of internet connectivity via Bluetooth, ensuring accessibility during emergencies.
“Digital cash would be private, secure, and trusted – the Reserve Bank will not control or see how you spend your money,” Woolford said.
Consultation and future plans
The consultation period for the digital cash initiative runs from April 17 until July 26, during which RBNZ seeks input from the public on various design options and considerations.
“We are planning for a future in New Zealand that has less cash, but not one that is cashless. We are committed to continuing to make cash available in forms that New Zealanders want to use.” Woolford said.
Further stages of this multi-year exploration are planned to continue until approximately 2030.
For the RBNZ media release, click here.
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