Russia’s largest financial institution, Sberbank, has urged that the launch of the digital ruble be delayed until 2026 due to financial and technological difficulties for the country’s banks and companies.
The Central Bank of Russia, meanwhile, is implementing its plan to issue digital currency by the end of 2025 in a broader push to renew the country’s financial ecosystem.
Demands for a Practical Timeline
As per Russian media outlet RBC, Sberbank has warned that the Central Bank’s schedule is unrealistic. Sberbank’s spokeswoman pointed out the high costs that commercial banks and retailers will have to incur to connect to the digital ruble system, which she said could amount to tens of billions of rubles.
The Russian financial institution also noted that the digital ruble platform remains under development and being updated frequently, which makes it difficult for financial institutions to prepare properly. “Many banks think its launch could be more realistically scheduled for sometime in the future—after 2026,” the spokesperson said.
Central Bank’s Resolve Despite Headwinds
Sberbank may have advised against the move, but the Central Bank is unswayed in its plans to launch its digital currency by the end of 2025. This campaign fits into the larger picture of Russian economic policy, which has involved things like trying to diversify away from the US dollar and strengthen its role in the BRICS bloc.
This is also the high-level strategy underneath the Mir payment system and the Faster Payments System.
But directly from smaller banks and retailers, the program isn’t necessarily a slam-dunk, as many of those institutions are demanding pre-packaged integration services from the Central Bank to lower their internal development costs.
Hurdles In Congress and Issues Of Readiness
Also key to the rollout plan was approval from Congress. Anatoly Aksakov, who heads the State Duma’s Committee on Financial Markets, said that a bill that would assist with the launch of the digital ruble can be enacted in early 2025.
Major banks and retailers would have to begin offering digital ruble services by mid-2025, and smaller institutions would have until 2027 to come into compliance under this framework.
Some institutions, including VTB and Promsvyazbank, have already confirmed their willingness to meet the deadlines, while medium- and small-sized banks expressed concerns regarding the considerable technological and financial burden.
Why It Could Take Time, According to Experts
According to industry insiders, a delay in the timeline for launching the digital ruble might be wise.
According to Anastasia Kalugina, Director of the Digital Finance Group at auditor firm Kept, numerous factors could hinder the Central Bank’s plan, including disorderly IT investments, the necessity for the regulation to be updated to eliminate data security issues, and the need for the public to trust in the new currency.
“Postponing the deadlines by one year or two is reasonable, as long as these risk factors are not left in place,” Kalugina said. A well-prepared and thoroughly tested rollout would, in the end, be better than sticking to an overly aggressive timeline, she added.
The Balance of Idealism and Realism
As such, it was regarded as a key element of Russia’s financial modernization and de-dollarization. But the tussle between the Central Bank and commercial entities like Sberbank shows the hurdles to a project so enervating. A balance needs to be struck between the need to innovate and the need to ensure readiness across the nation’s financial ecosystem.
For the digital ruble to succeed, it remains to be seen whether Russia’s policymakers and institutions can get on the same page about a timeline that balances quality and feasibility—or whether key stakeholders will continue to speak different languages.
FAQs
1. What does Sberbank have against the digital ruble?
Sberbank said the introduction of the digital ruble would take longer, and high costs of adoption, as well as unprepared banks, including those needing a complete overhaul of their IT infrastructure, would be one of the hurdles.
2. When had the Central Bank planned to launch the digital ruble?
The Central Bank of Russia plans to introduce the digital ruble by 2025 as part of modernizing Russia’s payment systems and strengthening economic ties as part of BRICS.
3. How much will banks have to spend on the digital ruble implementation?
Commercial banks might need to spend tens of billions of rubles on the digital ruble, including the development of new IT solutions and infrastructure modernization.
4. Is any legislation being enacted that would support the digital ruble?
A proposed bill may be adopted in early 2025 and will require major banks and retailers to offer digital ruble services by mid-2025, while smaller ones will have until 2027.
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