Will the digital ruble be in demand among Russians?

The first issue for this year of the Bank of Russia magazine “Money and Credit” published a study on the impact of the compatibility of the digital ruble with other forms of national currency on its popularity. In the analysis itself, 100% interoperability means that all transactions in the digital ruble “successfully take place and reach the addressee.” As a result, it is not entirely clear whether the authors are talking about converting the digital ruble into other types, about paying for goods and services with digital rubles, or about both scenarios.

Nevertheless, the assumptions made regarding the possible share of demand for the digital ruble among the population seem quite reasonable. In fact, two scenarios are proposed – when immediately half of bank clients using non-cash currency will transfer their transactions to digital rubles or when there will be only 14% of such clients.

The authors proceed from the results of a citizen survey conducted back in 2021. Then 14% of respondents said that they would definitely use the digital ruble, and another 36% answered “most likely yes.” In addition, based on data from a Central Bank survey, the indicator of the share of citizens who prefer cash for everyday payments was taken by the authors to be 20%.

It was determined that in the first scenario, the share of the digital ruble, as well as non-cash money, would be 40%, and cash – 20%. In a year, the share of non-cash payments would increase to 43.6%, and the digital ruble – to 40.8%. In the second scenario, the initial share of the digital ruble of 11.2% (14% of ardent supporters of the new currency from 80% of non-cash payment supporters) turns into an insignificant 3.7% after a year.

Not being a scientist, I was not very interested in the problems of interoperability. We were much more interested in the prospects of domestic banks. The idea that they will immediately lose half of their liabilities – after all, the digital ruble will be stored in the Central Bank, and not in the accounts of credit institutions – looks very intriguing, and even a loss of 11% at once should make bankers nervous. In this case, it is obvious that the second scenario can be considered optimistic for banks.

But in reality, the fate of the digital ruble will be decided by the regulator. If the Bank of Russia needs to calmly launch the third form of currency and slowly introduce it on the domestic market, while simultaneously working out cross-border transactions, then even 11% may turn out to be too much and 3.7% would be better at once. And if the Central Bank wants to promote the digital ruble in full, then it may well provide both 40% and 50% of payments in digital rubles, transferring all public sector salaries and social benefits to it.

This is exactly how the triumphant march of the “Peace” card across the country was ensured at one time. As the heroine Nonna Mordyukova said in the film “The Diamond Arm”: “And if they don’t take it, we’ll turn off the gas!”