Recent data found that consumers in Canada have a high awareness of the region’s CBDC but prefer cash when paying for goods and services.
The survey, conducted by Forum Research and the Bank of Canada, also found that cash was more likely to be preferred than credit cards, debit cards, and online transfers. That’s because unlike many other payment methods, cash has a sense of safety and anonymity around it—and it widely accepted by merchants. Some 93% of respondents reported using cash in the last month. In contrast, 69% of respondents said they used their credit cards, 60% used their debit cards, and 53% said they used online transfers during the same time period.
Digital currency, which is gradually growing in popularity on a global scale, is not a new concept in Canada. In fact, 87% of respondents said they were familiar with Canada’s digital dollar. But when asked if they’d use it at the point-of-sale, an overwhelming 85% said they would not. Only 12% said they would, while even fewer respondents (3%) said they weren’t sure yet.
However, 14% of respondents who hold cryptocurrencies expressed interest in using a Canadian CBDC for online shopping and to make a direct payment to a family member or friend. This interest can also be fueled by CBDCs’ more regulated and centralized nature, giving crypto holders an alternative to the more volatile cryptocurrencies.
What CBDC Adoption Looks Like Elsewhere
Central banks around the world are keen on developing their own central bank digital currency (CBDC)—not only to remain at the forefront of innovation, but to also leverage its many benefits. Those include faster and less-costly transactions and financial inclusion.
China is leading the pack in its CBDC development with the launch of its Digital Currency Electronic Payment (DCEP) initiative, which is digitizing coins and banknotes that are in circulation.
Meanwhile in Europe, the European Central Bank (ECB) is in a research phase, working out privacy issues and making CBDCs more cost-effective by reducing transaction costs.
The Bank of England is also investigating the launch of its digital pound, known as Britcoin. Their aim is to develop a type of central bank that can play well with its cash counterpart.