The IMF team has spent three months in Jordan studying the implications of a retail CBDC and has released a report on it for the Central Bank of Jordan.
The Central Bank of Jordan had requested the International Monetary Fund (IMF) to research a retail central bank digital currency (rCBDC) for the country. Accepting the request, the IMF conducted a three-month mission to Jordan in 2022. The mission aimed to study the payment system of Jordan, check the requirements and feasibility of an rCBDC and give recommendations on it.
Accordingly, the IMF released a recent report on their studies, outlining three objectives of a retail CBDC in Jordan. The report suggested if the Central Bank released a retail CBDC for the country, it would help increase financial inclusion, improve domestic payments through the rCBDC’s infrastructure, and reduce costs of cross-border remittances.
“RCBDC may offer some benefits, but it does not necessarily address pain points. On the other hand, a cross-border rCBDC could add value, particularly if the authorities coordinate with other countries in the region,” stated the report. The Central bank of Jordan had initially planned on releasing a central bank digital currency in 2022, but there have been certain hurdles on the way. The parliament of Jordan has opposed the move, while some problems remain in the country, such as low financial literacy and more cash usage.
The IMF report has also mentioned the institution was ready to offer technical assistance to the Central Bank of Jordan for the project. It concluded the report by offering a string of recommendations to the central bank for the rCBDC.