CFA Survey Shows Division In Plans To Launch CBDCs

Central banks globally have been working on launching central bank digital currencies (CBDCs) to keep up with the wave of digital transformation. Leading payments companies such as Mastercard are also launching tools that will aid in CBDC adoption. However, a CFA Institute survey has said there is a division on whether central banks should launch this product.

CFA survey shows division in CBDC launch

The survey by the CFA Institute polled over 90,000 members at the CFA Institute from China, Switzerland, China, and other countries. 42% of the respondents involved in this survey said they favored central banks launching CBDCs, while 34% of the respondents were opposed to these assets. 24% of the respondents said they had no opinion on the matter.

The survey findings further show that the self-reported understanding of CBDCs by finance professionals was limited. Only 12% of the respondents in the survey admitted to having a strong understanding of CBDCs. This indicates that governments and their central banks must put effort into educating people about CBDCs and their purpose before launching the products.

The study further noted that the respondents in developed markets were less supportive of CBDCs. Only 37% of the respondents in developed economies expressed enthusiasm about CBDCs. On the other hand, 61% of the respondents in emerging markets supported these products.

The classification of these results by region also showed that 33% of the respondents in North America had a favorable view of CBDCs. In comparison, 59% of the respondents in the Asia Pacific region were supportive of the product. A high level of support was seen in China, where 70% of the respondents supported the assets, while 66% of the respondents in India supported these assets.

Differing sentiments in developed and emerging markets

The difference in sentiments can be attributed to varying levels of economic development and capital market sophistication across developed and developing markets. Most developed markets also offered accessibility to cryptocurrency and digital assets, giving people valuable innovation in investment options.

Some respondents were also queried about their opposition to CBDCs, providing two distinct reasons behind the same. 50% of the respondents said they were concerned about data privacy, while 40% said they were concerned over the lack of use cases for a CBDC.

Despite the risks and the apparent challenges to adoption facing CBDCs, central banks are still pushing for these products. The Bank of England recently set up a CBDC advisory team comprising experts across different fields. Mastercard also launched a program to support the CBDC launch that included top players in the sector.

Emerging markets are also pushing for the launch of CBDCs. Nigeria became the first country in Africa to launch a CBDC. However, the adoption of the digital naira remains relatively low. The same cannot be said for China, whose CBDC is receiving massive adoption. Recent reports said the Chinese digital yuan was now used to make tax payments.