Norway Set to Make CBDC Decision by 2025, Favors Wholesale Approach
Norges Bank, Norway’s central bank, is preparing to make a final recommendation on implementing a central bank digital currency (CBDC) by 2025, with an increasing focus on wholesale applications rather than retail use. Deputy Central Bank Governor Pål Longva revealed this strategic direction in a recent interview with Bloomberg in Oslo.
Despite being one of the world’s most cashless societies, Norway is taking a measured approach to CBDC development. “I don’t think we’re falling behind on CBDC efforts,” Longva stated, emphasizing that the bank is aligned with many global counterparts in carefully studying the complex issues involved.
The central bank is examining both wholesale and retail CBDC options, though recent developments suggest a stronger inclination toward the wholesale model, which would facilitate interbank transactions. Longva noted that this trending preference among central banks “also goes for Norway,” while acknowledging that a retail version would require extensive coordination with private banks and stakeholders.
This deliberate pace comes amid a shifting landscape of CBDC development in Europe. While Switzerland has extended its wholesale CBDC pilot until 2026, and the European Central Bank continues to lay groundwork for a potential digital currency, Norway sees no urgent need to accelerate its timeline.
Recent data from Norges Bank indicates that cash usage in the country has stabilized, with only 2% of participants in a recent survey reporting cash use at physical points of sale. This low but stable cash usage suggests that while Norway leads in digital payments adoption, there’s still a place for traditional payment methods.
A government task force is set to submit a report on safe payment systems, including digital central bank money, by November 15. However, the final decision on CBDC implementation will ultimately rest with Norwegian lawmakers.
The bank’s careful approach reflects a broader trend among central banks worldwide, where the likelihood of implementing wholesale CBDCs within the next six years now exceeds that of retail versions, according to recent Bank for International Settlements data.
