The Governor of the Bank of Mauritius, Harvesh Kumar Seegolam, has announced that Mauritius is set to commence the pilot phase of its digital Rupee in November 2023 adding that many of the requirements are already set.
The Governor says he has prioritized the development of a CBDC (Central Bank Digital Currency) since taking office in 2020. He made this announcement while speaking at the International Monetary Fund/World Bank Community of Central Bank technologists meeting held on the main island.
“As a central banker, I need not stress upon the determining role that CBDCs can play, not only in protecting monetary sovereignty, but also in assisting central banks and regulatory authorities on the front of AML/CFT,” said Seegolam.
Back in May 2021 when Mauritius became the second African country to confirm it was exploring a CBDC, Seegolam had highlighted the trilemma concerns facing central bankers when it comes to CBDCs, which include:
- Compliance
- Secirity
- Privacy
The progress of their efforts was assisted by consultations with IMF experts and the production of a feasibility report in the same year he took office noting that Mauritius was the first country to benefit from IMF technical assistance with its CBDC project.
According to the Governor, the digital Rupee should be ‘a payment instrument to be made available to one and all’ that will be intermediated to ‘ensure that commercial banks continue to be fully-involved in our CBDC journey.’ It will also make monetary policy easier to manage and support financial stability, Seegolam added.
The digital Rupee will be interest free.
The apex bank has already set up a sandbox in partnership with an undisclosed party to explore potential features and tailor the digital currency to Mauritius’ specific needs. The second phase of the project will focus on the use of the digital Rupee in cross-border transactions.
Mauritius has been implementing blockchain technology for a few years and regulating digital asset custody licensing and security token offerings since 2019. It was previously considered an up-and-coming center for blockchain technology.
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