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The Bank of Canada’s research revealed mixed views on the digital Canadian dollar and highlighted Canadians’ enduring trust in cash and card payments.
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Canadian consumers showed skepticism toward the widespread early adoption of the Bank of Canada’s (BOC) concept of a digital dollar.
The Canadian central bank recently conducted research to identify consumers’ changes in preferences for payments, ultimately aimed at preparing itself for the development of an in-house central bank digital currency (CBDC).
The BOC’s research paper released on Oct. 28 reaffirmed Canadians’ long-standing affinity toward traditional, fiat-based payment systems amid growing support for the issuance of a digital Canadian dollar.
Spectrum of user segment positions on adoption. Source: Bank of Canada
According to a Bank of Canada survey from July, Canadians have a strong preference for cash and card payments for day-to-day purchases. Less than 3% of Canadians have used Bitcoin (BTC) or other cryptocurrencies for day-to-day payments since 2022.
Interest in CBDC does not translate to adoption
In contrast, 42% of the participants in the latest survey had favorable initial impressions of a hypothetical digital Canadian dollar, while only 20% of the lot outright “disliked” or “hated” the idea. The remaining 38% either took a neutral stance or revealed a lack of understanding about the technology.
The opportunity paradox: Users with high payment challenges may be late adopters of a hypothetical Digital Canadian dollar. Source: Bank of Canada
While the survey participants were open to CBDC issuance as a way to address limitations of fiat-based payments, the “interest does not necessarily translate to adoption,” the report noted.
Participants said a digital dollar would need to “demonstrate flawless reliability from day one” for widespread early adoption. Other expectations include ease of use, personal information privacy, security of transaction data, convenience and superior user experiences.
Most participants indicated that offline functionality was not critical for adoption, saying they would prefer cash during emergencies.
Canadians need CBDC to outperform the cash system
In addition to developing a better payment system, the Bank of Canada sees a need for significant investment and an awareness campaign to drive the adoption of a digital Canadian dollar.
Related: CBDCs and crypto should coexist, not compete — CoinDCX co-founder
The Canadian central bank recently said that it is “scaling down its work on a retail central bank digital currency and shifting its focus to broader payments system research and policy development.”
Additionally, Australia and Colombia have also halted plans to launch their respective in-house CBDCs.
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This article first appeared at Cointelegraph.com News
