The global race continues for development of a full functional CBDC, and the latest participant is Norway.
Norges Bank has been conducting the research implications of launching a CBDC for the past four years, including “technical testing” with in-depth analysis. The bank also noted that many other central banks around the world have been conducting similar research. With four years of analytical data, the bank is ready to press forward with development of the country’s first CBDC. “Due to the evolution of payments technologies, cash payments in Norway are now probably the lowest in the world,” said Øystein Olsen, Governor of Norges Bank.
“Additional knowledge would be necessary for the Central Banks to determine whether issuing a CBDC is appropriate,” he added.
Although the proposed testing will take place over the next two years, Norges Bank did not indicate when a CBDC would be launched in Norway. “Any introduction of a CBDC will still be determined some time in the future,” the central bank stated. Not presenting a definitive timeline for a CBDC was supported by the Deputy Governor of Norges Bank Ida Wolden Bache as well.
Speaking at Norway’s Finance & Payments Conference on Nov. 5, 2020, she described the decline of cash use in her country as influencing the decision surrounding CBDCs. Highlighting remarks of a recent survey, Wolden Bache indicated that only 4% of payments were made using cash. “The lack of urgency reflects our view so far that there is no acute need to introduce a CBDC,” she said.
It is widely known that China is leading the globe in the CBDC race, however there are other countries that have placed themselves in the think of things. Earlier this week, the Bank of England reported that it is taking landmark steps towards the creation of a CBDC, The Bank of Japan said it is currently completing research to determine the best way to pursue the development a CBDC. Other members include in research projects with Japan are the Bank for International Settlements (BIS), along with six Central Banks, including the U.S. Federal Reserve and the European Central Bank.
