Peru’s Central Reserve Bank has partnered with Viettel Peru to launch a pilot for a Central Bank Digital Currency (CBDC). This partnership aims to modernize the country’s financial infrastructure and integrate digital currency into the financial system. Viettel Peru S.A.C. will be the first participant in the year-long pilot program, which will involve collaboration with various stakeholders to ensure that the system design and functionality align with the BCRP’s requirements. This approach is intended to enhance user adoption and address potential barriers to entry.
In March 2023, the Central Reserve Bank of Peru published a report exploring the adoption of a CBDC. The report highlighted that currency is a digital liability of a central bank that the public uses as money. Peru faces challenges transitioning from a cash-based economy to a digital one, such as low financial inclusion and high payment service costs. The report emphasized the importance of addressing these challenges to achieve policy milestones, including increasing the use of digital payments among the unbanked population and building greater trust in payment systems.
The BCRP is considering three options to address these challenges: maintaining the status quo, improving access and interoperability of existing payment systems, and introducing a CBDC. The report concluded that Option 1 is not viable, while Options 2 and 3 form complementary policy strategies. Introducing a digital currency is anticipated to enhance Peru’s payment landscape with features like instantaneous and final payments, universal accessibility, and multiple use cases. The pilot program with Viettel Peru is a step towards realizing these benefits and modernizing the country’s financial infrastructure.
The selection process for the pilot program was conducted under Circular No. 0011-2024-BCRP, and the management of the BCRP issued Resolution No. 0009-2024-BCRP, naming Viettel Peru S.A.C. as the Participant of the First Digital Money Pilot. This partnership marks an important milestone in Peru’s journey towards a digital currency system. Viettel Peru will play a key role in leading the pilot program and integrating digital currency into the financial system. The collaboration with various stakeholders will ensure that the system design and functionality align with the BCRP’s requirements, enhancing user adoption and addressing potential barriers to entry.
The pilot program in Peru is part of a broader effort to modernize the country’s financial infrastructure and improve financial inclusion. The partnership between the Central Reserve Bank and Viettel Peru highlights the importance of advancing digital currency initiatives to address the challenges facing Peru’s transition to a digital economy. With features like instantaneous and final payments, universal accessibility, and multiple use cases, a CBDC has the potential to enhance Peru’s payment landscape and drive economic growth. The pilot program with Viettel Peru is a significant step towards realizing these benefits and modernizing the country’s financial system.
