What is the digital ruble in simple terms and how will it change life in Russia?
The digital ruble is a new form of currency being developed by the Central Bank of Russia. It exists not in the form of paper bills or coins, but exclusively in digital format. In simple terms, it is money that is stored not in cash, but on a special digital account. However, unlike electronic money, such as the funds on a bank card, the digital ruble is a currency created and directly controlled by the state, and it will be stored in an electronic wallet provided by the Central Bank.
Why is the digital ruble needed?
The introduction of the digital ruble aims to achieve several objectives:
- Cost reduction: The digital ruble allows for a decrease in the costs associated with issuing and managing cash, as well as facilitating non-cash payments. It is a more economical way to circulate money.
- Combating the illegal economy: By controlling the digital ruble, the government gains more opportunities to track transactions, helping to combat money laundering and corruption.
- Expanding access to financial services: In remote regions of Russia, where banks may be inaccessible, the digital ruble can serve as a simple and safe way to conduct operations.
Where and how will the digital ruble be used?
The digital ruble will be usable much like regular money — for purchasing goods and services, transferring funds between individuals, and making payments to government agencies. The main difference is that all transactions will occur through special digital wallets issued by the Central Bank. These wallets will be accessible through bank applications and specialized platforms, where operations can be conducted without fees or with minimal costs.
What are the benefits of the digital ruble for citizens?
- Accessibility and ease of use: The digital ruble will be available to everyone, regardless of whether a person has a bank account or access to a bank. This will enable any citizen with a smartphone or computer to make payments.
- No or minimal fees: It is expected that the digital ruble will be cheaper than bank transfers. Payments and transfers can be made almost for free.
- Security and protection against theft: The digital ruble will be secured by government systems, significantly reducing the risk of theft or loss of funds compared to cash or bank transfers.
How will the digital ruble impact the Russian economy?
- Control over cash flows: With the ability to track transactions, the government will be able to monitor cash flows more accurately, increasing the transparency of the economy.
- Resilience to sanctions: In the face of sanction pressures, Russia can utilize the digital ruble for transactions bypassing international financial systems, thereby maintaining independence.
- Support for small and medium-sized businesses: The digital ruble will simplify operations for businesses and reduce payment processing costs, positively influencing their growth.
How will the digital ruble affect citizens?
- Convenience and accessibility: With the introduction of the digital ruble, Russians will be able to easily pay for goods and services without using bank cards. This is especially important for those with limited access to banking services.
- Increased financial literacy: The implementation of the digital ruble will provide citizens with the opportunity to quickly master modern methods of financial management. In the long term, this could lead to an increase in overall financial literacy among the population.
- Transaction transparency: Government oversight of the digital ruble will enhance the transparency of all transactions, aiding the fight against the shadow economy. However, this also means that the government will be able to monitor citizens' spending.
A conclusion from the founder of Open Oil Market
The introduction of the digital ruble is an important step towards modernizing the Russian economy and financial system. As an entrepreneur, I understand that the digital ruble can offer new opportunities for businesses by simplifying payment processes and reducing costs associated with financial operations. For citizens, the digital ruble will become an accessible tool for safe and convenient transactions. In the long run, this innovation will help create a more stable and resilient economy that can better adapt to contemporary challenges and maintain independence from external influences.
