The Georgian central bank plans to release a document outlining the idea of a national digital currency. It will be used to polish up their suggestions for the pilot, which the monetary authority intends to start in the first half of the year.
A whitepaper on the “digital lari” will be made available by the National Bank of Georgia (NBG), allowing prospective partners to make adjustments to their proposals before the project’s test phase. The NBG decided to delay the trials for this year instead of starting a pilot program for the central bank digital currency (CBDC) in 2022.
In an interview with the Rustavi 2 TV channel, Deputy Governor of NBG Papuna Lezhava stated that in the first half of 2023, “we will publish the document and soon after that, together with the winning partner, we will discuss how long it would take to implement the project.”
Lezhava further disclosed that several alternate strategies for evaluating the digital version of the Georgian Lari have already been given the green light. He however noted that the decision on whether to continue with the project’s actual launching has not yet been decided.
Reasons for the CBDC launching
One of Georgia’s monetary policy regulators had earlier commented that the development of the CBDC has been necessitated by the development of digital technology. He explained that the mandate of the NBG is to ensure financial and price stability and to make this possible at this dispensation, there is a need to leverage the current technological trends by developing a central bank currency and the creation of a digital version of the Georgian lari.
The bank further revealed that the necessity for a CBDC emanates from the need to adapt to the demands of the digital economy and improve the efficacy of monetary policy. It also made clear that the digital lari will be adopted as legal tender in Georgia.
The NBG provided further information while emphasizing the new platform’s offline functionality. In comparison to the present fiat lari in both cash and non-cash forms, the digital lari will be less expensive, more secure, and will be a quicker method of payment. Operations involving the digital lari won’t require the assistance of intermediaries, commercial banks, or payment systems.
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