Outside Source
Interoperability, privacy, and infrastructure still pose hurdles to retail CBDC adoption, a survey by GlobalData reveals.
Central bank digital currencies are still a tough sell, even where they’ve officially launched. GlobalData’s latest survey report reveals that for consumers in many countries, CBDCs just don’t offer enough to make the switch from familiar payment methods, as state-backed digital currencies struggle with a lack of user incentives, privacy concerns, and technological challenges.
Blandina Szalay, banking and payments analyst at GlobalData, says the “very limited uptake of CBDC in countries where it fully launched — in the Bahamas, Jamaica, the Eastern Caribbean Currency Union, and Nigeria — can be attributed to the lack of compelling incentives for consumers to switch to CBDCs from the payment methods they are already used to.”
Convenience and habit also play a big role in how people choose to pay. According to GlobalData, CBDCs haven’t yet delivered enough benefits to make them a better option. In fact, in places with active CBDC programs, users have complained that the new systems make payments more complicated without “offering sufficient benefits.”
For central banks, the challenge isn’t just technical though. Szalay says that reaching widespread adoption is crucial to achieving the benefits CBDCs are supposed to bring, like improved “cross-border payment efficiencies, fostering financial inclusion, and newfound financial and monetary stability.”
As of September 2024, a report by the Atlantic Council revealed that 134 countries, representing 98% of the global economy, were exploring CBDCs. Over 65 nations, including India, Australia, and Brazil, are in advanced stages of development, piloting, or launching their CBDC projects. All G20 countries are now actively investigating their own digital currencies, with 19 in advanced stages of exploration.
This article first appeared at crypto.news
