Brasil is set to implement the digital version of its currency later this year, according to the president of the country's Central Bank, Roberto Campos Neto.

At an industry event on Monday (11), Campos Neto said the Real Digital project, which will see the introduction of the digital version of Brazil's currency, the real, towards the end of 2022. However, there is the possibility that the project will suffer a "slight delay" due to an ongoing workers' strike at the institution, even though work around the implementation is already underway.

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In a timetable presented by the executive at the event, the most recent development around the creation of the Central Bank Digital Currency (CBDC) is the start of the execution of the projects that have been selected to be part of the initiative on March 28. This phase is set to conclude by July 29. The pilots will then commence in the fourth quarter of this year.

When the guidelines for the CBDC were launched in May 2021, the Central Bank said the digital real would work as an extension of the traditional currency. The distribution of the digital real will be intermediated by custodians of the National Financial System and the Brazilian Payments System, with no remuneration to these institutions.

The launch of the project is part of a broader modernization plan for the Brazilian payments industry, which has also involved the launch of instant payments and Open Finance. It was preceded by a series of analyses on the positive impact, as well as the risks involved in having a digital real, such as data protection and cyber security, as well as regulatory issues.

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At the time the guidelines were launched, the central bank noted the digital real should allow for "full compliance with international recommendations and legal norms on the prevention of money laundering, financing of terrorism, and financing of the proliferation of weapons of mass destruction," as well as "compliance with court orders to track illicit operations."

Moreover, the digital real is expected to allow for interoperability and integration with a view to enabling cross-border payments. The institution noted resilience and cybersecurity standards equivalent to the arrangements applicable to critical financial market infrastructure in terms of cybersecurity.

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