Report: IMF Warns Kenyan Central Bank Against Introducing a CBDC That Harms Fintechs and Banks
The global lending institution, the International Monetary Fund has told the Kenyan central bank that its proposed digital shilling must “do no harm” to existing private sector digital money. The lender insisted the proposed central bank digital currency must “not stifle such welcome digitalisation developments by taking away customers of banks and other digital finance providers.
“The paper could state the intent of potential issuance of CBDC is to complement rather than substitute existing private-sector digital payment solutions, and affirm CBK’s commitment to an open, competitive payment system. We note in this regard that the balance between central bank money and private sector payment instruments is not fixed over time, and there is no ‘right’ balance,” the IMF is quoted as stating.
The IMF also argued that the digital shilling must also not result in the increased cost of financing for banks, or deny “banks of valuable information they obtain through establishing customer relations.”Tags in this story
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