Mexico will begin operating a digital currency issued by the Central Bank of Mexico (Banxico) in 2025, the bank’s governor, Victoria Rodríguez Ceja, announced Thursday, April 21.
The new digital currency, which will be known as Central Bank Digital Currency (CBDC), is intended to generate alternative means of payment and providing greater financial inclusion.
The social benefits derived from the Mexican CBDC could be significant, according to a study released by Merchant Machine in March, since Mexico is among the top five countries with the least financial inclusion, after Morocco, Vietnam, Egypt and the Philippines.
The Banking Association of Mexico recognizes that 53 percent of the adults in the country do not have a bank account, and seven out of 10 do not have access to credit, according to Bitcoin News.
So far, central bank digital currencies have been implemented in the Bahamas (Sand Dollar), China (Digital Renminbi), Sweden (E-Krona), Marshall Islands (Sovereign) and the Organization of Eastern Caribbean States (DXCD), whose CBDC prototype operates in Antigua, Barbuda, Grenada, Saint Lucia, St. Kitts and Nevis
The new CBDC will also expand options for fast, secure, efficient and interoperable payments, while implementing competitive features to payment methods, Rodríguez Ceja told the Mexican Senate Finance Committee.
“We estimate that the final operation process will take about three years and will be aimed at both banked and unbanked people, expanding payment possibilities,” she said.
Rodríguez Ceja also said that the digital currency will comply with three basic characteristics: a means of payment, a unit of account and a store of value, and will coexist with physical bills and coins circulating across the country
Banxico first announced plans to introduce a digital currency two years ago.