Experts warn: investing in digital ruble too expensive for small banks

Experts Warn: High Costs of Investing in Digital Ruble Pose Challenges for Small Russian Banks

Experts are sounding the alarm that the high costs of investment required to join the digital ruble platform could be prohibitive for small Russian banks. According to information from the Russian newspaper “Kommersant,” these costs significantly exceed the annual technological budgets of small financial institutions.

Costs of Entry into the Digital Ruble Platform

It is estimated that the cost of updating systems necessary to handle the Bank of Russia’s digital currency, including software for banking automation and compliance, will range from 120 to over 200 million rubles, translating to approximately 1.3 to 2.2 million dollars.

Planned Introduction of the Digital Ruble

The Bank of Russia plans to introduce services related to the digital ruble in all banks by 2027. This process will start with systemically important institutions in 2025. Sberbank, a leader in the Russian banking sector, is set to begin digital ruble services for customers as early as the beginning of 2025.

Testing and Pilot Actions

A prototype of the digital ruble was unveiled by the Bank of Russia in December 2021, with testing commencing in 2022. In August 2023, customers and employees of 13 Russian banks participated in pilot transactions. In September, the central bank expanded the pilot program, now involving up to 9,000 individuals and 1,200 businesses.

Timeline for the Introduction of the Digital Ruble

In July, the Central Bank of Russia indicated that the digital ruble may be available to the wider public by July 2025. It was also assured that the digital currency will complement, not replace, existing cash and cashless rubles.