South Korea to pilot central bank digital currency in 2024
The Bank of Korea has announced that it will collaborate with the Korean Financial Services Commission and the Korean Financial Supervisory Service to pilot central bank digital currency (CBDC) for 100,000 people.
Korea to pilot digital currency with 100,000 citizens next year - The Korea Times
Korea to test central bank digital currency with public vouchers
http://www.koreaherald.com/view.php?ud=20231123000636
In this CBDC distribution test, 100,000 selected individuals will be able to purchase some goods and services with 'deposit tokens' issued by commercial banks in the form of CBDC. However, participants are restricted to using the tokens only for specified payment purposes, and no other actions, including personal transfers, are permitted.
Eligible individuals will be determined by commercial banks, and the trial is scheduled to continue for three months starting around September or October 2024.
The Korean government already provides medical and welfare assistance in the form of vouchers, but these vouchers come in various forms, including paper and digital, making them unsuitable for integrated management. Therefore, there are moves to solve management issues by incorporating CBDC into existing voucher systems.
Kim Dong-seop, head of the Bank of Korea's digital currency strategy team, explained, ``Using CBDC as a voucher will improve efficiency on the management side,'' explaining the slowness of the payment process and the limitations of post-transaction rights verification. pointed out that CBDC has the potential to resolve concerns about fraudulent billing.
“South Korea is already a highly digitalized country, so the introduction of CBDC-style vouchers may not be a revolutionary change,” said Ahn Byung-nam, head of the Financial Services Agency's digital asset research team. The government believes that even if it were introduced, it would not cause confusion among the public.
Bank for International Settlements President Agustín Carstens welcomed the project, calling it the 'digital won' and positively evaluated the central bank's efforts towards a future monetary system.
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