Kazakhstan Digital Tenge drastically reduces VAT refund wait
Kazakhstan's National Bank launched a pilot project with its CBDC, the digital tenge, to improve VAT reimbursement processing. The project reduced the waiting time for refunds from 70-75 days to 10-15 days by automating VAT marking in transactions. This efficiency is due to eliminating manual checks by the tax authority. The digital tenge's programmability is also being tested in public procurement and investment subsidies.
Read MoreDigital tenge to support transparent government spending
Digital tenge platform helps to ensure transparent government spending, reduce costs, speed up cross-border payments
Read MoreDigital Money is Spearheading the Next Wave of Public Financial Management (PFM) Reforms in EAP
The use of digital money is a top priority for public financial management (PFM) reforms in the EAP region, led by Korea and followed by China, Indonesia, Vietnam, the Philippines, and Mongolia. This shift aims to transform government payment systems, reducing cash use and enhancing efficiency, cost savings, transparency, and convenience. The PEMNA T-COP meeting in Bangkok highlighted these efforts, with countries sharing experiences and plans. Initiatives include issuing credit and debit cards to government employees and citizens, especially in remote areas, to facilitate transactions. Despite progress, countries continue to strengthen basic PFM systems like TSA and IFMIS.
Read MoreJamaica’s CBDC used for government ‘seasonal work’ payments
Jamaica’s central bank digital currency (CBDC), Jam-Dex, has been used to make government payments to seasonal workers in two localities, marking one of the first operational uses of a CBDC globally. This initiative, part of the Employment Generation (Christmas Work) Programme, aims to enhance financial inclusion by providing a safe, convenient, and secure digital payment method. Launched in July last year, Jam-Dex is currently supported by the National Commercial Bank’s Lynk digital wallet. The Bank of Jamaica plans to expand Jam-Dex’s use to other government programmes, including a social and welfare initiative under the Ministry of Labour and Social Security. The pre-Christmas payments involved over 100 workers and 70 small merchants, with all participants opting for Jam-Dex over physical cash.
Read MoreBahamas ‘Sand Dollar’ CBDC put to use for payroll
One year after the launch of the Sand Dollar, the world’s first central bank digital currency (CBDC) in the Bahamas, Island Pay and Bahama Eats have partnered to use the CBDC for payroll. Bahama Eats employees now receive their salaries via the Island Pay digital wallet. This initiative is seen as a significant step in the global advancement of CBDCs, offering secure and convenient payroll solutions while reducing costs. The partnership aims to democratize access to money and enhance financial inclusion. This development is likely to attract attention from global officials and central bankers exploring CBDC opportunities.
Read More14 projects picked for CBDC pilots in Australia
The Reserve Bank of Australia (RBA) has selected 14 projects for CBDC trials, exploring diverse use cases such as payments in livestock auctions and construction work. These projects, chosen from over 140 submissions, mark a significant step in the RBA’s research into a potential digital Australian dollar. The trials, conducted in collaboration with the Digital Finance Cooperative Research Centre (DFCRC), aim to provide practical insights into CBDC applications. The selected projects include offline payments, corporate bond settlement, and foreign exchange settlement, reflecting a broad interest in CBDC’s potential benefits. The outcomes of these pilots will inform future CBDC developments in Australia and potentially influence global CBDC discussions.
Read MoreNigeria to expand eNaira for government payments, MDAs transactions
The Central Bank of Nigeria (CBN) plans to expand the use of its digital currency, eNaira, to facilitate payments into government accounts and allow Ministries, Departments, and Agencies (MDAs) to initiate vendor and beneficiary payments.
Read MoreKazakhstan Launches Digital Tenge: A New Era of Cashless Payments Begins
Kazakhstan has launched its central bank digital currency (CBDC), the digital tenge, with a demo transaction using contactless card technology. The National Payments Corporation of Kazakhstan announced the platform’s operation during a conference on 15 November. Chairman Binur Zhalenov made the first ceremonial purchase in digital tenge. The digital currency will be rolled out in stages, initially focusing on government fund disbursement. This development is significant as only a few countries have issued CBDCs. The digital tenge aims to enhance cashless payments, government transparency, and innovative financial products. The project includes partnerships with Visa, Mastercard, and local banks, with full implementation expected by 2025.
Read MoreKazakhstan Launches Pilot Project for Programmable Digital Tenge in Budget Expenditures
The National Bank of Kazakhstan has launched a pilot project using the digital tenge platform for budget expenditures, marking the second phase of introducing Kazakhstan’s national digital currency. This project, funded by the National Fund, focuses on the programmability of digital tenge, initially financing the Dostyk-Moiynty railway construction. The technology ensures efficient spending by marking funds, which can only be disbursed to compliant organizations, enhancing transparency and efficiency. The pilot involves multiple entities, including JSC Samruk-Kazyna and JSC Halyk Bank, with plans to expand its application to other projects and sectors, aiming to mitigate fund misappropriation and improve public spending transparency. The final report on this phase will be released at the end of 2024.
Read MoreIndia: e-RUPI Digital Payment Solution for Targeted Benefits
Prime Minister Narendra Modi launched e-RUPI, a digital payment solution, via video conferencing. Developed by NPCI, the Department of Financial Services, the Ministry of Health and Welfare, and the National Health Authority, e-RUPI is a QR code or SMS-based e-voucher. It ensures targeted, transparent, and leak-proof delivery of benefits, strengthening Direct Benefit Transfer (DBT). The system connects service sponsors with beneficiaries and providers without physical interaction, guaranteeing payment only after service completion. Several banks, including SBI and HDFC, are onboard for issuing and redeeming e-RUPI vouchers, enhancing digital transactions in India.
Read MoreBank of China Launches e-CNY Smart Contract Program for Primary Education
The Bank of China has launched a new program in Chengdu, Sichuan province, allowing primary school children to enroll in after-school programs using the digital yuan (e-CNY). This initiative, in partnership with local education and financial authorities, uses smart contracts to manage payments. Parents pay a deposit, and if a child misses a lesson, the e-CNY is automatically refunded. The program aims to enhance transaction transparency and liquidity, with zero transaction fees. Previously, the Bank of China used e-CNY in an airdrop program to promote sustainable activities. Currently, over 4.5 million merchants in China accept e-CNY, highlighting the country’s digital economy efforts.
Read MoreWorld Bank: Smart Contract Technology and Financial Inclusion: Enhancing Access and Efficiency in Financial Services
The World Bank Group’s report on “Smart Contract Technology and Financial Inclusion” explores the potential of smart contracts, particularly those based on blockchain technology, to enhance financial inclusion. It highlights how smart contracts can reduce transaction costs, improve transparency, and automate processes, making financial services more accessible and efficient. The report discusses various applications, including supply chain finance, insurance, and consumer credit, emphasizing the benefits for micro, small, and medium enterprises (MSMEs) and underserved populations. It also addresses legal and policy considerations, such as consumer protection, customer due diligence, and the need for standardization and vetting to ensure responsible deployment of smart contracts.
Read MoreTransforming Public Procurement with Smart Contracts
Organizations face numerous challenges in traditional procurement processes, such as inefficiencies, delays, and susceptibility to fraud due to extensive paperwork, multiple intermediaries, and complex approval workflows. These issues lead to high administrative costs and elongated timelines, with a lack of transparency and accountability further exacerbating the situation. Smart contracts, which are self-executing contracts stored on a blockchain, offer a solution by providing transparency, security, and efficiency. They automate and streamline procurement activities, reducing costs and enhancing compliance. The immutable nature of blockchain ensures all transactions are transparent and tamper-proof, minimizing the risk of fraud and corruption.
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