Today the Swiss Federal Council published a
report on the potential for a universally accessible, or retail Central Bank Digital Currency (CBDC). In the paper, it concludes that it would be hard to achieve the promised benefits of a retail CBDC or e-franc and the risks outweigh the promise. Additionally, it sees other better ways to accomplish the advantages sought. In contrast, it sees far lower risks with an institutional CBDC.
The report outlines the perceived benefits of a retail CBDC to include financial inclusion, digital money without default risk, improved payments efficiency, monetary policy effective and financial stability. Additional potential advantages include a reduction in tax evasion and money laundering. But the authors state: “CBDC for the general public meets these expectations only partly or not at all.”
Aside from the risks that accompany a retail CBDC, it would also require legislative changes. Both the Federal Council and the Swiss National Bank (SNB) share the view that, for now, a retail CBDC would not bring additional benefits for Switzerland, but would bring risks.
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