Russian Bank Experiments With Digital Ruble Transfers via Mobile Application
Promsvyazbank (PSB) is one of the first Russian lenders to join the Bank of Russia’s Digital Currency (CBDC) experiences. According to a report by business news outlet Plus Journal, the bank recently tested digital ruble transactions through its mobile application.
To perform operations, participants had to pass the application registration and create a digital wallet. Then, using their accounts, they were able to replace regular electronic bank funds with digital ruble and transfer digital cash to other bank customers as well as other bank customers involved in the pilot project.
All information about transactions carried out through the digital ruble platform operated by the Central Bank of Russia (CBR) was provided, and was immediately reflected on the credits of digital users’ wallets in the smartphone app, according to the details of the report. The platform’s prototype was launched by the monetary authority late last year.
“PSB is one of the first banks to apply simple and understandable technology to make transactions using digital ruble in mobile application and test it successfully. We see great potential in this tool, which we expect to become a new standard of compromise in the Russian economy “, stated Senior Vice President Alexander Chernoshikin, who heads the bank’s digital business unit.
The chief executive added that the successful test lays the foundation for future operations with the digital ruble and opens up new opportunities for the public and Russian companies. Reliable and secure transfers in digital currency would be available to the population, while the State would have additional tools to manage budget and targeted social payments.
Chernoshiken added that the new settlement technology will help companies solve the problem of automating all payments and internal work processes. Bank of Russia is responsible for storage and accounting in the digital ruble ecosystem and CBR officials claim that all payments are subject to encryption and other measures to prevent fraud.
At least a dozen credit institutions decided to join the digital ruble test, once their systems were ready to connect to the CBDC platform, as part of experiments that began in early 2022. Last summer, Russia accelerated the project’s timeline, aiming to fully launch its digital currency in 2024.
Promsvyazbank is among the top 10 banks in Russia in terms of assets and deposits. Previously a private bank owned by Russian oligarchs, brothers Dmitry and Alexei Ananiev, it was nationalized by the Russian government in 2018 and has since been recognized as a bank supporting the Russian defense industry. The sanctions imposed because of Russia’s military intervention in Ukraine were targeted.