Central banks have cited several reasons for considering or piloting central bank digital currencies (CBDC). These include a desire to enhance financial stability and monetary policy, improve payment systems, and contribute to financial inclusion. 

However, uncertainty still exists regarding how a CBDC can be designed to promote greater access and meaningful usage in a more inclusive digital payments system without exacerbating divides for vulnerable populations.  

The potential risks and opportunities warrant further exploration, particularly as the national and regional context will significantly influence the ultimate impact of CBDC.  

Over the past few years, Cenfri has undertaken several studies relating to CBDC considerations in low-and-middle-income countries (LMICs). These include: 

• CBDC for emerging markets: The realities and expectations (an overview of the way Cenfri defines CBDC and our understanding of its potential in emerging markets)
• The potential of CBDCs for financial inclusion (with AFI)
• Tailored CBDC technical assistance in emerging markets (with GIZ)
• Central bank digital currency (CBDC) and financial inclusion (with FSD Africa)
• Eswatini Central Bank Digital Currency diagnostic study (with the Central Bank of Eswatini) 
• Understanding Retail Central Bank Digital Currencies and their Potential for Revenue Authorities (for the DIGITAX Programme at the Institute of Development Studies) 

We have also developed several shorter outputs and presentations on CBDC: 

• Central Bank Digital Currencies: Five Lessons From Three Trailblazers 
• Overthrowing the King: Could Central Bank Digital Currencies replace cash in post-COVID-19 Africa? 
• Central Bank Digital Currency and illicit financial flows 
• DFC in the common monetary area: a presentation to an ITY working group 

If you are keen to talk to us about CBDC or contract us for related work email antonia@cenfri.org.