Peru’s Central Bank Initiates CBDC Pilot with Viettel Peru

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Hongji Feng

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Hongji Feng

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Hongji is a crypto and tech reporter. He graduated from Northwestern University's Medill School of Journalism with a Bachelor's and a Master's. He has previously interned at HTX (Huobi Global),...

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July 23, 2024 18:12 EDT

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Peru’s Central Reserve Bank partnered with Viettel Peru on July 17 to launch a pilot for a Central Bank Digital Currency (CBDC).

According to a recent announcement by the Central Reserve Bank of Peru (BCRP), Viettel Peru S.A.C. will be the first participant in this year-long pilot, integrating digital currency into the financial system and modernizing the country’s financial infrastructure.

CBDC Pilot Program to Kick Off in Peru

The pilot will involve collaboration with various stakeholders to ensure the system design and functionality align with the BCRP’s requirements. This approach is intended to enhance user adoption and address potential barriers to entry.

🏦💵¿𝗟𝗮 𝗖𝗕𝗗𝗖 𝗲𝗻 𝗣𝗲𝗿𝘂́ 𝗲𝘀𝘁𝗮 𝗰𝗮𝗱𝗮 𝘃𝗲𝘇 𝗺𝗮𝘀 𝗰𝗲𝗿𝗰𝗮?

El Banco Central de Reserva del Perú (BCRP) ha seleccionado a Viettel Perú S.A.C., conocido comercialmente como Bitel, para liderar el primer piloto de moneda digital en Perú.

𝗗𝘂𝗿𝗮𝗰𝗶𝗼́𝗻 𝘆… pic.twitter.com/YIXmb2Ou6K

— Protocolo🍊🍊🍊🍊 (@ProtocoloCrypto) July 17, 2024

“Following a selection process conducted under Circular No. 0011-2024-BCRP, the management of the BCRP issued Resolution No. 0009-2024-BCRP, which establishes that the Participant of the First Digital Money Pilot is the company Viettel Perú S.A.C.,” the file read.

BCRP’s 2023 Report on Digital Currency

In March 2023, the Central Reserve Bank published a report exploring the adoption of a CBDC. The report highlighted that currency is a digital liability of a central bank that the public uses as money.

“A CBDC can be complementary to the set of existing payment instruments, including banknotes and coins issued by the BCRP,” stated the report.

Peru faces major challenges transitioning from a cash-based economy to a digital one, including low financial inclusion and high payment service costs.

The report emphasized that addressing challenges is crucial for achieving policy milestones, such as increasing the use of digital payments among the unbanked population and building greater trust in payment systems.

The BCRP is considering three options to address these challenges: maintaining the status quo, improving access and interoperability of existing payment systems, and introducing a CBDC.

“Option 1 is not viable, while Options 2 and 3 form complementary policy strategies,” the report concluded.

The report highlighted that introducing a digital currency is anticipated to enhance Peru’s payment landscape with features like instantaneous and final payments, universal accessibility, and multiple use cases.