Progress is being made in the issuance of a retail digital currency: Irene Espinosa


Banco de México is advancing in the development of its own digital currency. In essence, it will be a digital peso issued by the Bank of Mexico (Banxico) in the same way as legal tender bills and coins, explained Deputy Governor Irene Espinosa.

Banxico’s digital currency will be retail, which means that it will be available to any citizen. It will open opportunities for more Mexicans to have access to digital payments and will have the security that it operates under a regulatory framework.

Interviewed by El Economista, she said that it is still early to give a name to the digital currency of the Bank of Mexico. But she stressed that it will be fiduciary money whose value will be based on the confidence that the central bank itself grants, by taking responsibility for the liabilities that it will issue.

“We will issue a current currency with digital presentation. In essence, it will be a digital peso issued by the central bank in the same way as legal tender bills and coins, but we are still not sure what name it will bear,” he commented.

The central banker explained that before managing the digital currency issued by Banxico, they will have to go through three stages that are built organically, that is, they advance one on top of the other.

At this time, the modification of the rules of the Interbank Electronic Payment System (SPEI) and others that include part of the regulations that will regulate the first stage of digital currency have been made available to the public, he observed.

“We hope that in the coming months, after feedback from the participants in the financial system and the public, the first stage will be operational.”

The principle, the CoDi

The central banker explained that the Digital Collection (CoDi) based on the technology of QR codes and NFC is the beginning and the construction of the path for a digital currency that involves many developments.

CoDi is a system of payment requirements for a service or product, through an application that runs on the SPEI road where all the market participants are. Its management has no cost and offers the unique opportunity to expand the coverage of financial services, he considered.

It is a gateway for more Mexicans to have access to the financial system, since its management allows financial institutions to know the users and in this way, it can open access to financial services.

In the first stage towards Banxico’s digital currency, there are transfers based on a single data, which will be a telephone number linked to a bank account. The second stage will be the tokenized payment that will be able to generate a first record on the payment and the third stage is a digital currency issued by the central bank.

The deputy governor admitted that, during the pandemic, the promotion of its management among businesses and businesses that want to request payments was interrupted, since face-to-face advice is required.

Inflation and banking

According to the central banker, authorized fintech companies offer additional channels for people to integrate into the formal financial system.

They are better alternatives of lower cost for the population excluded from the formal financial system, he commented.

Then, he explained that in the context of upward pressure on inflation, “the need for financial inclusion in unprotected sectors is urgent.”

According to her, people in these segments keep their savings in cash and in the context of high inflation, they lose their value rapidly.

It is important to redouble efforts in greater banking and inclusion and comply with our price stability mandate in order to reduce inflation. We have and are working to be able to attack inflation levels for the benefit of the population so that their assets, savings and equity do not lose their value.

CoDi is a system of payment requirements for a service or product, through an application that runs on the SPEI road where all the market participants are.

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