The law will now proceed to the Russian Federal Assembly’s upper chamber and, if approved, to the president’s desk.
The digital ruble, a project of the Russian central bank’s (CBDC), has made progress toward realization. The third reading of the digital ruble bill was approved by the State Duma, the lower house of the Russian Federation’s Federal Assembly, on July 11th. The bill will now move on to the Federation Council, the assembly’s upper house, where it will likely be adopted before being forwarded to the president for final approval.
The State Duma was presented with the digital ruble bill in December 2022. Since then, it has undergone a number of revisions to provide the legal basis for the introduction of the digital currency. Important clauses that define important terminology like “platform,” “participants,” and “users” were incorporated in the most recent amendment at the end of June. To build a clear understanding of the roles and duties within the digital ruble ecosystem, these definitions are crucial.
The Bank of Russia (BoR) will take on a central role as the primary operator of the digital ruble infrastructure under the present framework described in the bill. By holding all digital assets in the form of rubles, the central bank is positioned to maintain the security and reliability of the system.
According to the BoR, the main purpose of the CBDC is to serve as a means of payment and transfer, with users unable to open savings accounts. Payments and transfers are free for individual customers, however they cost 0.3% of the payment amount for businesses.
The law was presented to the State Duma in December 2022, and in March 2023 it was given its first reading. A Gazprombank subsidiary expressed worries in February about potential risks for banks in the event of a quick switch to digital money.
Gazprombank is a significant government-owned gas firm in Russia. The potential losses to traditional banks from the adoption of the CBDC were projected by a McKinsey branch in Russia to be around 250 billion rubles ($3.5 billion) over five years, compared to an annual profit of $1.1 billion for merchants.
The deputy head of the central bank, Olga Skorobogatova, recently declared that all Russian residents would have access to the digital ruble by 2027. Between 2023 and 2024, a pilot program to evaluate the CBDC will be carried out. This timeline demonstrates the Russian government’s desire to push its plans for a digital ruble and eventually make them available to the entire populace.