Kenya’s Central bank opens public discussion on CBDC

The Central bank of Kenya (CBK), has published a discussion paper on its Central Bank Digital Currency (CBDC), while seeking public comments on the potential benefits and risks, and related policy considerations, of introducing a CBDC in Kenya.

In s statement, the Bank said the discussion paper will examine the applicability of a potential Central Bank Digital Currency (CBDC) in Kenya.

“It is part of CBK’s initiatives to ensure informed policy decisions regarding innovations. The Discussion Paper invites comments from the public to be considered when assessing the potential use case for CBDC in Kenya.”

What is CBDC?

CBDC is an electronic form of central bank money that can be used by households and businesses to make payments and store value.

The regulator said it has been closely monitoring these developments globally which prompted the CBK to prepare the Discussion Paper that outlines the evolution of payments globally and in Kenya and discusses recent digital payment methods including electronic money, CBDC, stable coins and other cryptocurrencies.

“It outlines Kenya’s payment landscape and assesses the potential applicability of CBDC. Further, it highlights the potential opportunities and risks presented by CBDC.” The Bank noted.

The central bank will collect comments on the issue via an online form for 100 days.

The governor of the Central Bank Dr Patrick Njoroge previously said they were exploring the use of central bank digital currency (CBDC) to settle cross-border payments.

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