A significant migration from paper currency to digital means of payment will take place in the next few years, according to João Manoel Pinho de Mello, a director of the Central Bank of Brazil (BCB).
During a panel discussion about the potential of the digital real organized by BCB, Mello stated that the move to digital payments will involve the use of central bank digital currencies (CBDC), Valor Economico, a Brazilian financial newspaper, reported.
“We understand that the use of CBDC will occur in situations where it is able to bring greater efficiency and transparency to transactions, whether from the retail perspective or its use by agents that make up the financial and payments industry,” said Mello, director of the financial system organization and resolution division at BCB.
If they are designed well, official digital currencies can expand financial inclusion and reduce the cost and time of cross-border payments, Mello said, adding that the process requires “extreme care in the choice of design and technologies” to avoid violations of data protection laws, bank runs and cyberattacks.
Mello also argued that the use of digital currencies between different countries “should be given special consideration” to “avoid unwanted substitutions of one country’s sovereign currency for that of another.”
Roberto Campos Neto, president of the central bank, said Brazil could be ready for a digital currency next year.
Banking 4.0 – „how was the experience for you”
„So many people are coming here to Bucharest, people that I see and interact on linkedin and now I get the change to meet them in person. It was like being to the Football World Cup but this was the World Cup on linkedin in payments and open banking.”
Many more interesting quotes in the video below:
