A pilot scheme for Russia’s digital ruble is due to have kicked off on 15 August.

Like many other countries, Russia is seeking to modernise its financial system through a central bank digital currency (CBDC) as it looks to fend off the threat of cryptocurrencies.

The pilot, which will launch through 13 banks, will see a limited number of clients be able to open digital wallets and send and receive payments in digital rubles. They will also be able to pay for goods and services through Russia’s Faster Payments Service at 30 retail outlets located in 11 Russian cities.

"We were preparing a long while for the start of real transactions,” First Deputy Governor of the Bank of Russia Olga Skorobogatova said at a press conference, earlier in August. “This pilot will involve, in the first instance, testing of such active transactions as the opening of wallets in digital rubles for banks, clients (individuals and legal entities), transfers of digital rubles between clients and payments in trade and service businesses.”

According to the Central Bank, citizens and businesses should be able to use the CBDC at their own request starting in 2025. When fully rolled out, the ruble will help Russia develop cross-border payments with other countries that issue digital currencies.

The Central Bank is promoting the digital ruble as a third variant of the Russian national currency, intended to complement the existing forms of money (cash and non-cash) issued by the Bank of Russia, and has been keen to emphasise its benefits for both citizens and businesses. These benefits encompass convenient access to the digital wallet through any bank, standardised transaction tariffs aimed at reducing operational costs, availability of the currency even without internet connectivity, strong fund security, a wider range of innovative products and services, and improved customer service conditions.

Some concerns have, however, been raised about the future of the digital ruble. In particular, experts have noted that the Central Bank will fully control the issuance and circulation of the digital ruble, meaning it will more easily be able to track the transactions of citizens. It has also been suggested that the authorities could use the digital ruble to tighten repression, limiting transfers to people designated “foreign agents.”

The Central Bank has, however, been keen to stress that it will not forcibly introduce the digital ruble, although there have been suggestions that all salaries to civil servants and state employees will eventually be moved to the digital ruble, as well as all benefit payments and pensions.