IMF Head: No ‘Universal Case’ for CBDCs

There’s no universal case for central bank digital currencies, the International Monetary Fund’s Managing Director Kristalina Georgieva said during remarks delivered at an event today, urging policymakers to carefully weigh tradeoffs as innovation in financial technology evolves. Georgieva said that around 100 countries are exploring CBDCs with “some researching, some testing and a few already distributing CBDC to the public.” There is no universal case, she added, because each economy is different.

While “no one size fits all” was Georgieva’s main message, the two other key lessons she noted were that financial stability and privacy considerations are “paramount” to the design of CBDCs, and that introducing a CBDC is about “finding the delicate balance between developments on the design front and on the policy front.” The IMF today also released a report on emerging trends, insights and policy lessons on CBDCs.

The American Bankers Association recently weighed in on the risks associated with issuing a CBDC in the United States, warning that doing so could compete with bank deposits and limit banks’ ability to power economic growth.