ANZ Will Test Out Offline CBDC Smart Card Payments
ANZ is working with two universities to test offline CBDC payments with smart cards that can be loaded with money and used like cash.
The Reserve Bank of Australia is running fourteen pilot projects like this one to find out how a central bank digital currency could be used.
With blockchain technology and NFC-enabled smart cards, CBDC might allow peer-to-peer fast payments in offline environments without banking infrastructure, according to the ANZ trial.
The pilot will take place on Southern Cross University’s and RMIT University’s campuses. The pilot gives pupils NFC-enabled smart cards pre-loaded with CBDC monies.
The goal is to show how an organization like a university may step in and give quick financial help via CBDC disbursement in emergency circumstances, such as when students cannot access cash online or through standard banking systems.
There will be a few steps to the pilot. First, the universities will run a secure app for smartphones that will let students see how much CBDC they have. Using NFC, specific amounts of CBDC will be loaded onto smart cards.
Second, the smart cards will be given to the students who are taking part. They can use them to buy things at cafes, gyms, and book stores on campus.
Finally, businesses will use a secure smartphone app to receive student card payments at point of sale, transferring CBDC payments offsite. These payments from customers to merchants are the same as cash sales.
Lastly, merchants will be able to see how much CBDC they have received through their app and can choose to turn their CBDC balance into regular currency, which will be sent to their bank accounts.
Researchers at the universities plan to do scalability tests for more sensitive use cases, such as payments to communities affected by disasters or government-funded payment programs for communities in need.
This is one of four tests in the RBA pilot that are backed by ANZ. In another project, the efficiency and effectiveness of employers using CBDC for superannuation contributions as an alternative to traditional payment methods will be tested. A third project will look at the issuance of CBDC in line with KYC processes.
A fourth project, done in partnership with CBA, will show how nature-based assets can be turned into tokens, how commercial bank stablecoins can be made, and how smart contracts can be used to settle atomically on a public, permissionless blockchain. This pilot aims to show how CBDC can be used as a risk-free settlement asset by allowing commercial banks to issue stablecoins in AUD.
