In 2023, Nepal Rastra Bank (NRB) has established a dedicated section within the Payment Systems Department with the objective of eventually introducing a digital currency within the country. The NRB’s plan involves commencing pilot testing of the Central Bank Digital Currency (CBDC) by the year 2025. In August 2022, NRB released a comprehensive study report pertaining to the CBDC. This study advocates for a CBDC framework that caters to retail usage, employing an intermediary-based architecture and a semi-centralized ledger. This design, offering both account-based and token-based access, is deemed the most suitable option within Nepal’s context. Additionally, the CBDC system should seamlessly collaborate with other regulated private payment systems to enhance accessibility, resilience, and inclusivity in payments. The system is expected to operate around the clock, come with a holding limit, not accrue interest on CBDC holdings, and offer programmability for diverse usage scenarios.
The primary objectives of the CBDC encompass enhancing payment accessibility, advancing financial inclusion, fortifying payment system resilience, safeguarding the central bank’s monetary authority, decreasing currency management expenses, boosting the efficiency of cross-border payments, fostering financial transparency, refining the transmission of monetary policies, bolstering financial stability, and aiding the government in welfare distribution efforts.
Source:
https://www.nrb.org.np/contents/uploads/2022/10/CBDC-for-Nepal.pdf