Moroccan central bank urges caution in dealing with CBDCs

Morocco’s central bank governor Abdellatif Jouahri advocated a cautious approach in adopting central bank digital currencies (CBDCs), recalling that the bank set up a working group to look at the matter in 2021.

Speaking to a conference attended by IMF chief Kristina Georgieva, Jouahri underscored the urgent character of examining CBDCs which have a role to play in financial inclusion and reducing the amount of cash in circulation, estimated in Morocco at 30% of all transactions.

However, he pointed at the need of bridging the digital divide by ensuring access to digital infrastructure.

He advocated what he called a “camel approach” in the sense of moving with caution in implementing CBDCs, which he said are now part of the mission of central banks.

IMF chief Giergieva said the IMF was considering a platform for CBDCs in order to ensure they are not limited to domestic uses only.

She said CBDCs are key to reducing the cost of remittances and promoting financial inclusion but there was a pressing need for coordination between central banks

“CBDCs should not be fragmented national propositions… To have more efficient and fairer transactions we need systems that connect countries: we need interoperability,” Georgieva was reported by Reuters as saying.

Already 114 central banks are at some stage of CBDC exploration, “with about 10 already crossing the finish line”, she said.

Georgieva also warned of leaving the void to cryptocurrencies which are often not backed by assets exposing citizens to risks.