Central Bank of Mauritius (BoM) will launch a pilot project to test the digital Mauritian rupee after a three-year study of its capabilities.
Bank of Mauritius (BoM) Governor Harvesh Kumar Seegolam said the pilot program will be launched in November 2023.
Sigolam believes the digital rupee will protect the state’s monetary sovereignty, as well as help other central banks and regulators combat money laundering and terrorist financing.
In 2020, the Bank of Mauritius sought technical assistance from the International Monetary Fund (IMF) on the issue.
For three years, BoM has been studying the feasibility of launching a state cryptocurrency.
The researchers concluded that it will work on the principle of a two-tier model, in which commercial banks will also be participants.
This will allow banks to maintain their role in the country’s monetary ecosystem and avoid dramatic shocks to the financial sector.
Now the central bank is ready to take its research to the next level, within the regulatory sandbox, to “tailor” the state-owned stablcoin to the peculiarities of the country’s financial system.
Sigolam said the Central Bank of Mauritius will initially launch an interest-free digital rupee.
And in a second phase of the pilot project will explore cross-border payments using it. BoM manager hopes it will simplify and speed up international money transfers.
In addition, a public consultation on the issue will begin in June for industry participants and stakeholders to share their views on the use of the digital rupee as a means of payment.
In 2019, the Republic of Mauritius began issuing licenses to cryptocurrency services. In the same year, the Financial Services Commission of Mauritius (FSC) introduced guidance on the regulation of token shares.