The Qatar Central Bank (QCB) is reportedly investigating the possibility of launching a digital currency and issuing digital banking licenses.
According to the head of the fintech section at QCB, Alanood Abdullah Al Muftah, the central bank expected to set a direction for its future focus on a range of fintech verticals.
Al Muftah noted that QCB will also determine whether Qatar can adopt a central bank digital currency (CBDC). She explained:
“Every central bank should study digital banks, given their growing significance in the global market. We are also seeing the market move towards a digital currency. However, it is still under investigation whether we have a digital currency or not.”
While commenting on Qatar’s regulatory sandbox, Al Muftah said three companies in the payments sector are currently testing solutions at the central bank. She also stated that the QCB is considering other companies interested in using the regulatory sandbox.
A regulatory sandbox is a space where fintech companies can test new products, services, business models and delivery mechanisms in a real world, while taking advantage of an accelerated authorization process and oversight.
Private Qatari bank Dukhan Bank, meanwhile, is exploring the possibility of establishing a digital bank in Qatar, its chief operations and digital officer Narayanan Srinivasan told The Peninsula. However, Srinivasan warned that his institution would only build a digital bank after a better understanding of its economy. According to the report, Dukhan Bank is also considering blockchain technology in the payments sector.
Related: The Philippines Launches a Pilot CBDC Deployment
While private virtual currencies such as Bitcoin (BTC) have grown in popularity and following, government-backed CBDCs, often considered an antithesis of private cryptocurrencies, are rapidly accelerating. According to data from the Atlantic Council, as of June 2019, 87 countries are currently developing their own digital currencies, of which only 14 have completed the pilot phase. Nine countries have already introduced a CBDC. †