Bank of Israel’s latest report presents a “optimal” digital shekel design, although the implementation will depend on cooperation with MPs and industry stakeholders.
Bank of Israel has unveiled an initial design for digital shekel, but its launch will depend on further discussion with the government.
In documentThe Central Bank of Israel said that Digital Shekels are designed to be accessible to all, saying that the state-state-state will be available to the entire public including “children, foreigners (including tourists), all types of businesses, public institutions and financial institutions.”
“Similar to cash, it will be a universal means of payment – anyone will be able to pay anyone, and anyone will be able to receive payment from anyone, but with the convenience and advancement of digital means of payment.”
Bank of Israel
It is believed that businesses will pay low cost compared to current options, although it is not clear whether the fees will be applied. The Central Bank claims that the Central Bank will intensify with the support for offline payments with the Digital Currency.
Addressing privacy concerns, the Bank of Israel assured that the level of privacy would “be higher than the current digital payment.”
“The level of privacy in digital shekel will be higher than the current digital payment, and similar to cash, it will also offer a limited amount of anonymous payment.”
Bank of Israel
Digital shekels can also integrate with other systems, making users “able to receive or pay payments in digital shekels, even if the other side does not use digital shekel for payment.”
The Central Bank emphasized that a final decision has not yet been taken on issuing digital shekels, given that if the future status shows more than cost and risks, the bank of Israel will be prepared to implement “Action Plan”.
Bank of Israel began looking at Digital Shekel in 2017, researching the possible benefits and challenges of launching a CBDC. During the initial phase, he focused on global trends in digital currencies, the technology behind them, and how they can affect monetary policy and financial stability. In 2021, the bank took a special team up to a notch to deeply dive into developing digital shekels.
