IMF Releases Guidelines for Boosting CBDC Adoption with REDI Framework
- It proposed a high-level framework REDIregulation, education, design, and deployment.
- The REDI framework was prepared by staff members of the International Monetary Fund.
Policymakers and financial institutions may find guidance on how to boost the use of central bank digital currencies (CBDCs) in a new guide issued by the International Monetary Fund (IMF).
September 21 saw the release of a report titled Central Bank Digital Currency Adoption Inclusive Strategies for Intermediaries and Users by the International Monetary Fund. Both intermediaries and end-users should be included in the methods that are put forward in the paper. It proposed a high-level framework for REDIregulation, education, design, and deploymentto encourage the use of CBDCs.
Prioritizing Engaging Stakeholders
The International Monetary Fund has said that in order to successfully implement CBDCs, proactive strategic policy and design decisions that are beneficial to both end-users and intermediaries are necessary. That is why they said that central banks should prioritize engaging stakeholders.
In order to assist national central banks in increasing the use of CBDC, the REDI framework was prepared by staff members of the International Monetary Fund. Four main components make up the REDI framework. In the first part of the paper, regulation, lawmakers consider several legal and regulatory options for encouraging the use of CBDCs.
The education portion suggests that central banks play a pivotal role in establishing communication initiatives to raise CBDC understanding. Thirdly, the paper stressed the need of developing a vast network of intermediaries and tactics that target certain user groups.
Finally, the part concluded by suggesting financial and non-financial incentives to promote widespread use of CBDCs. The International Monetary Fund has proposed a number of reforms. Including the subsidization of merchant startup fees, transaction fees, and taxes. Existing issues were also urged to be further discussed in the paper.
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