Russia ‘Edging Toward Mandatory CBDC Pensions’ – Economist

Tim Alper

Last updated:

January 14, 2024 06:31 EST | 2 min read

Disclosure: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. By using this website, you agree to our terms and conditions. We may utilise affiliate links within our content, and receive commission.Source: Kira/AdobeA Russian economist has claimed Moscow will eventually force the elderly to accept CBDC pension payments as part of the digital ruble rollout.

Per Pro Blast, the claims were made by the writer and economist Alexander Razuvaev, who said:

“Gradually, [conventional] pensions will be replaced with payments made in digital rubles. In the near future, this is most likely inevitable. So, little by little, pensioners are being driven into the Central Bank’s trap. They are being encouraged to switch to a new type of money.”

Razuvaev added that the CBDC adoption “trend” would “only intensify over time,” as “technological progress takes its toll.”

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CBDC Fear Growing in Russia?

Critics of the Russian government have reacted to the CBDC pilot with no shortage of caution.

Some fear creeping government control over financial freedom and say the Central Bank is trying to seize control of the economy.

Ministries have talked openly about making “colored” or “marked” digital ruble payments to reduce child benefit and subsidy fraud.

The finance ministry wants to trial CBDC social security payments this year, ahead of a national rollout in 2025.

However, some fear a sharp rise in government monitoring of citizens’ behavior.

The CBDC is rolling out at the same time as Moscow’s push to collect biometric data from its citizens.

The Central Bank has insisted that the biometric data drive and the digital ruble are two separate projects.

However, this has done little to allay suspicion about the “new form” of the ruble in many areas.

How Close Is Russia to Making CBDC Pension Payments?

Legislation passed in 2023 legalized the issuance of digital ruble pensions. But these are yet to become a reality for Russian citizens.

Elvira Nabiullina, the Central Bank Governor, has stated that nobody will be “forced” to receive digital ruble pension payments. She stated:

“The Central Bank only advocates the voluntary transfer of pensions to digital ruble wallets. This is our position on the matter.”

Nabiullina noted that pensions have undergone a successful recent change that illustrated the safety of CBDC pension payments.

In 2017, Moscow launched MIR, a card payment for electronic fund transfers.

The headquarters of MIR in Moscow, Russia. (Source: Alexander V. Solomin [CC BY-SA 4.0])The platform was mainly designed to serve as an alternative to Visa and MasterCard payments.

But it was eventually modified to allow pension payments. Nabiullina said:

“Many people have successfully opted to transfer pensions to their MIR cards. But many are now forgetting that pensioners always had a choice. They could choose to receive their pension in cash, or as a bank transfer or check.”