The Bank of Russia has been implementing a project to create a digital ruble (link in Russian) since 2021, and the large-scale introduction of the new form of national currency will begin on 1 September 2026. The Bank of Russia team has provided the regulatory framework and ensured the information security of the project, carrying out all basic types of operations using the digital ruble, including transfers between individuals and legal entities, payments, salary payments, and budget payments, and gained experience with smart contracts, said Zulfiya Kakhrumanova, Deputy Governor of the Bank of Russia and moderator of the session on the digital ruble at the Bank of Russia’s Financial Congress. She invited the session participants to talk about the future and discuss what needs to be done to ensure that the digital ruble is not only a new payment instrument but also becomes a technological platform enabling all its participants to create new, in-demand services for citizens and businesses, whilst at the same time remaining attractive to financial market participants. Econs provides excerpts from the discussion.
Ilya Ivaninsky, Director of the Centre for Business Education and Analytics at the Central University:
– A few years ago, we estimated that the transition of the BRICS and CIS countries to ‘banking of the future’ – the next stage after ecosystem banking – would generate a cumulative benefit of $81 billion a year. One of the key elements of banking of the future is blockchain. Blockchain is a financial infrastructure that can be compared to electricity, with wires running through the walls. From the consumer’s point of view, it doesn’t matter what brand or model this ‘wiring’ is, as long as it doesn’t start sparking. But market professionals such as regulators must consider the entire infrastructure.
If everything goes to plan and all goes well, smart contracts and the digital ruble will become the financial infrastructure of the new platform economy. The platform economy currently accounts for about 8.5% of GDP (link in Russian), and it will grow. But it is important to understand that both the digital ruble and blockchain-based infrastructure are, first and foremost, infrastructure. It is never ‘turned on’ quickly. For example, LTE technology, which we are now familiar with, appeared in 2009, but it was not until 2016 that it became widely adopted.
Ekaterina Elmanova, Deputy Chairwoman of the Management Board of Rosselkhozbank:
– The synergy between the smart contract platform and the digital ruble platform enables banks to plan and understand what services can be developed specifically on the basis of these two platforms. When the ruble becomes programmable, this makes it possible to programme the conditions under which it may be paid out. Not only the regulator but also market participants themselves will be able to create smart contract scenarios. For us, this is no longer just theory: here in Chuvashia, we are currently working with the Ministry of Finance, the Ministry of Agriculture, and the State Technical Supervision Agency to implement a scheme for paying subsidies (link in Russian) to farmers for the purchase of agricultural machinery. The most important factor is the time taken to receive the subsidy – instead of months of waiting, it is reduced to a few hours.
Such scenarios will enable us to access the liquidity that banks will lose when using the digital ruble. It is important that the threshold for banks to connect to the digital ruble platform in future be low and that banks and other market participants take an active role.
Denis Dodon, Director of Innovation Development Center, Alfa-Bank:
– At a certain point, there will be no non-targeted funds left in the market. On all public markets where funding is raised, it must be controlled: where it is used, how it is applied, and so on. Often, when a new product enters the market, the market may not be ready, either technologically or in other respects. If the digital ruble had been introduced, for example, three years ago, I think it would have been much more difficult.
Igor Ostreyko, Senior Vice President, Head of Transaction Business Department, VTB Bank:
– The digital ruble could well represent an opportunity for the market to move to a new level of digitalisation. VTB Bank has tested all baseline scenarios for the introduction of the digital ruble. Transactions between individuals or legal entities, the purchase of a Troika card on the metro, or paying for parking are just a few examples of what can be done with digital rubles. Where the digital ruble takes hold will depend on how well the three ‘pillars’ – convenience, speed, and reliability – are implemented. If we all work together to make transactions using the digital ruble convenient and fast – faster than the conventional ruble currently ‘works’ – for both corporate clients and individuals, and reliable, with a minimum of disruptions, then we will have a wide range of scenarios. The main ones are automatic debits, the monitoring of movements of funds, and, presumably, 24/7 operations in the financial sector.
Dmitry Dubynin, General Director of NSPK:
– It’s hard to impress anyone with speed these days, but absolutely all services now operate online. When there are connection disruptions, it causes inconvenience. We have, in principle, designed our payment system so that customers do not need an internet connection at any given moment. Thus, for the digital ruble and the services we have become used to, processing payments in a completely offline environment is definitely a challenge at present. Perhaps it will be a wearable device, perhaps a mobile app that can operate and exchange data via other interfaces – perhaps NFC or Bluetooth. But I think we definitely need to move towards such a solution. Complete convenience in payments can be achieved once we manage to implement a fully offline solution.
Igor Kudinov, Advisor to the Rector of ITMO University:
– When it comes to preventing fraud and other potential issues that arise with offline payments, fraud must be economically unviable. A similar principle can be applied when using digital ruble technologies. For example, introducing transaction limits and additional authorisation tools (such as, for instance, additional SMS verification). The separate wallets that users can create for offline settlements must have additional layers of protection at the cryptographic level. I believe that banks have more than enough imagination and existing developments in the field of information security to ensure the safety of transactions.
The system for verifying smart contracts must be multi-layered. One tool that we, as representatives of the academic community, envisage is test sites, which can be used to run through scenarios for basic smart contracts. Universities could serve as such test sites, starting with basic tasks – such as the disbursement of scholarships – and progressing to more complex scenarios, such as research projects. Furthermore, artificial intelligence technologies could be used to search for and identify vulnerabilities in existing smart contracts.
Boris Vedernikov, Member of the Board of Directors at Tochka bank:
– Currently, there is not yet mass demand for the digital ruble amongst small and medium-sized enterprises, but we can already identify potential groups of forward-thinking entrepreneurs who see the digital ruble as a tool for optimising costs and speeding up mutual settlements with partners. They are interested in specific services that can help automate their business operations. These include the automation of payment settlements, the targeted use of funds, subsidies, state support, government contracts, and reductions in acquisition and transfer costs. For further mass adoption amongst small and medium-sized enterprises, there is great potential in developing services that enable specific business challenges to be addressed – services that can reduce costs, automate routine tasks, and simplify accounting.
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