September 28, 2022
  • September 28, 2022

Sanctioned Russian Bank Tests In-App Operations With Digital Rubles CryptoBlog

By on September 3, 2022 0

A Russian bank, one of the country’s largest by assets, has conducted a successful trial with digital ruble transactions processed through its mobile app. The state-owned Promsvyazbank was one of the institutions placed under Western sanctions earlier this year in connection with Moscow’s actions in Ukraine.

Russian bank experiments with digital ruble transfers via mobile app

Promsvyazbank (PSB) is one of the first Russian lenders to participate in the trials of the Central Bank Digital Currency (CBDC) issued by the Bank of Russia. According to a report by the business newspaper Plus Journal, the bank recently tested digital transactions in rubles through its application for mobile devices.

To perform the operations, the participants had to pass a registration in the application and set up a digital wallet. Then, using their account, they were able to exchange regular electronic bank money for digital rubles and transfer digital money to other customers of the bank as well as those of other banks participating in the pilot project. .

All information about the transactions made was provided by the digital ruble platform operated by the Central Bank of Russia (CBR) and was immediately reflected in the balances of users’ digital wallets in the smartphone application, details the report. The prototype of the platform was launched by the monetary authority at the end of last year.

“PSB is one of the first banks to implement a simple and understandable technology for transacting with digital rubles in a mobile application and successfully test it. We see great potential in this instrument, which we hope will become a new settlement standard in the Russian economy,” said Senior Vice President Alexander Chernoshchekin, who heads the bank’s digital business unit.

The leader added that the successful tests lay the foundation for future operations with the digital ruble and open up new opportunities for the Russian public and businesses. Reliable and secure transfers in digital currency will be made available to the population while the state will have additional tools to administer budgetary payments and targeted social payments, he explained.

The new settlement technology will help businesses solve the problem of automating all payments and internal business processes, Chernoshchekin added. The Bank of Russia is responsible for storage and accounting in the digital ruble ecosystem, and CBR officials say all payments are subject to encryption and other measures to prevent fraud.

No less than a dozen credit institutions have decided to join the test of the digital ruble, once their systems are ready to connect to the CBDC platform, as part of the trials that began in early 2022. This summer, the Russia has accelerated the timeline for the project, aiming for a full launch of its digital currency in 2024.

Promsvyazbank is among the top 10 banks in Russia in terms of assets and deposits. Once a private bank owned by Russian oligarchs brothers Dmitry and Alexei Ananyev, it was nationalized by the Russian government in 2018 and has since been recognized as a bank supporting the Russian defense industry. He was the target of sanctions imposed following Russia’s military intervention in Ukraine.

Keywords in this story

Bank, Bank of Russia, Bank, CBDC, Central bank, Cryptocurrency, Digital currency, digital ruble, Digital wallet, Mobile app, operations, Promsvyazbank, PSB, Russia, russian, Test, Testing, testing, transactions, Trial, trials

Do you think Russia could introduce the digital ruble sooner than expected? Share your expectations in the comments section below.

Lubomir Tassev

Lubomir Tassev is a tech-savvy Eastern European journalist who loves Hitchens’ quote: “Being a writer is who I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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