Although Brazil is a recent entrant to studying digital currencies, its central bank’s president says the country could launch one as soon as 2022.
Per local news outlet Correio Brazilienese, president Roberto Campos Neto has indicated that digital currencies will be “the future of the financial system.”
In an interview with Bloomberg Markets and Finance on Sept 2, Campos Neto said that the necessary conditions for the issuance of central bank digital currency (CBDC) are developing in Brazil.
He went on to note that the country’s central bank had already undertaken measures to modernize the Brazilian financial system, which makes a native CBDC “a natural outcome.”
His remarks also alluded to a potential timeline for a CBDC rollout, “We think we will have this in 2022.”
The conditions Campos Neto refers to are the presence of efficient and instant payment infrastructure, an open system, and a convertible, international currency that people trust.
Banco Central appears to be intent on joining its Uruguayan neighbors and has already begun building the foundation for a CBDC.
In August, the bank announced the formation of a dedicated group to examine how a CBDC could fit with the existing payments ecosystem and what its impact might be on the Brazilian economy. The working group is supposed to publish its finding in the next six to twelve months.
In November, the central bank is set to take another step forward with the planned launch of an instant payment system called PIX. Open Banking is also in the process of being implemented in Brazil to increase competition in the national financial system.
In this way, Campos Neto’s comments underlined that a Brazilian CBDC is “not the cause, but the consequence of this process of digitization and modernization.”