Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Japan puts central bank digital currencies on policy roadmap

Published 17/07/2020, 10:40
Updated 17/07/2020, 10:45
© Reuters. A pedestrian holding an umbrella to take shelter from rain and hail walks past the Bank of Japan headquarters building in Tokyo

© Reuters. A pedestrian holding an umbrella to take shelter from rain and hail walks past the Bank of Japan headquarters building in Tokyo

By Tetsushi Kajimoto and Daniel Leussink

TOKYO (Reuters) - Japan will look closer into whether to issue central bank digital currencies (CBDCs), the government said in its annual policy roadmap, a sign that Tokyo may be warming to the idea as the coronavirus heightens demand for cashless payments.

In its first-ever reference to digital currency in the annual plan, the government urged the Bank of Japan (BOJ) to liaise with other countries to jointly examine its feasibility.

"The BOJ will coordinate with other countries to consider CBDCs by examining and verifying technological tests," according to the document, which serves as guidance for the government's long-term economic and fiscal policies.

Facebook (NASDAQ:FB)'s efforts to launch its Libra cryptocurrency stablecoin have forced central banks to look more seriously into issuing their own digital currencies.

China has been among countries leading in the drive toward issuing CBDCs, prompting some Japanese ruling party lawmakers to urge Tokyo to catch up.

However, the government and the BOJ have been cautious about moving too quickly given the legal barriers and social disruptions it may cause in a country that has the most cash-loving population in the world.

Still, the pandemic may add momentum to calls for Japan to look into CBDCs more seriously, if more people avoid handling hard cash, and to move towards digital settlement, analysts say.

While the BOJ has said it has no immediate plans to issue a digital currency, it is conducting research with other central banks on the issue.

As part of a wider move to boost digital payment systems, the government is seeking a cut in interbank transfer fees. It will review the fees, which have been unchanged for more than four decades, by the current fiscal year end next March, a government official said.

The issue was included in this year's economic growth strategy that was approved by the cabinet alongside the annual policy plan on Friday.

© Reuters. A pedestrian holding an umbrella to take shelter from rain and hail walks past the Bank of Japan headquarters building in Tokyo

In the growth strategy, the government said it would make it easier for working people to take on multiple jobs and that it would come up with new rules for freelance work.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.