Kazakhstan's National Payment Corporation intends to connect more banks to digital tenge - chairman

Commentary Materials 17 May 2024 08:00 (UTC +04:00)
Binur Zhalenov
Binur Zhalenov
Read more

BAKU, Azerbaijan, May 17. The National Payment Corporation of the National Bank of Kazakhstan intends to connect more banks to the digital tenge, Chairman of the Board of the National Payment Corporation (NPC) of Kazakhstan Binur Zhalenov told Trend on the margins of the Fintex Summit in Baku.

"We are implementing the digital tenge project in three stages. The first stage was introduced last year. Including working with companies such as Visa and Mastercard, we have provided the opportunity to spend digital tenge anywhere in the world. This year, we have ambitions to expand the project. Firstly, connect more banks. Let me remind you that last year we connected five banks; this year we have a goal to connect at least ten banks," he said.

According to Zhalenov, a new scenario in digital tenge is also being implemented.

"The first direction is to ensure transparency in government spending. We signed a roadmap together with the Ministry of Finance and the Anti-Corruption Service on the implementation of pilot projects using digital tenge. We want to ensure the targeted use of public funds. If money is allocated for the construction of a school, then it is “colored” in accordance with the design and estimate documentation, and digital tenge can only be spent on goods and services related to the construction of the school," Zhalenov said.

He noted that the second direction is cross-border payments. "This year, we expect to go from being an observer to becoming a full participant in the mBridge project of the Bank for International Settlements and launching cross-border payments in digital currencies on November 15," he said.

As the chairman of the NPC noted, it is also planned to use the digital tenge for the digital asset industry.

"In particular, we expect that the regulator will support the launch of a crypto card. That is, this will make it possible to spend USDT from a crypto-wallet using digital tenge. There are also areas related to digital vouchers. In particular, free meals in schools. It will be digitized using digital tenge smart contracts," he noted.

To note, the digital tenge project underwent a pre-launch phase in 2021 to assess its feasibility. Subsequent research and testing with real consumers and businesses continued throughout 2022.

On November 15, 2023, the initial phase of implementing the digital tenge platform within the industrial circuit commenced. Collaborating with the Almaty city's administration and Kazpost postal service company, a pilot project introducing "digital vouchers" for complimentary meals in schools was initiated. Furthermore, in conjunction with international payment systems and four second-tier banks, the world witnessed the debut of bank cards connected to a digital account in the central bank's digital currency. This innovative development enables citizens to utilize, withdraw, and conduct transactions worldwide, all within a familiar user interface.