Russian mobile networks plan wallet and payment services for digital ruble

Two leading Russia telecoms operators are in talks to provide mobile wallet and other services that would support a digital ruble, according to reports emerging in local media.

Mobile networks Beeline and Megafon are reported to be considering supporting services for an eventual central bank digital currency (CBDC), which would effectively equip millions of citizens with the necessary technology to transact in digital rubles.

The technology would link the wallet directly with the user’s mobile phone number. If rolled out more broadly across the country, the move would see every mobile user assigned a digital currency wallet.

While plans are thought to be at an early stage of development, representatives from Beeline said the Bank of Russia’s current model for CBDCs had yet to acknowledge the role of digital wallets on smartphones and other devices.

The networks are also reported to be considering models for peer to peer payments through the wallet, which would allow handset users to transact privately without the need for a third party payment processor.

A spokesperson for Beeline said this type of P2P model could provide direct financial links between citizens, without the need for transaction middlemen.

“We are interested in such aspects of using the digital ruble as maintaining wallets on smart devices … not just providing a link between the client and the central bank or financial intermediary.”

The development follows on from the Bank of Russia’s announcement that it had begun consulting on a digital ruble, with plans in place for a pilot scheme later in the year.

It comes at a time of increasing global competition between central banks and governments keen on launching central bank digital currencies. Powered by blockchain, CBDCs allow users to receive fiat currency as digital tokens, for more efficient payments.

To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.

See also: CoinGeek Live panel, The Future of Banking, Financial Products & Blockchain