CBDC: Expanding Financial Inclusion or Deepening the Divide?

In recent years, policymakers worldwide have been exploring Central Bank Digital Currency (CBDC). CBDC has the opportunity to play an essential role as a public good, serving the public interest both as public money (with value maintained by the central bank) and as a public money technology (with core infrastructure also maintained by the central bank or another public entity). Retail CBDC is the only digital, user-accessible money form that is a liability of the central bank. Because of these unique attributes, some commentators have suggested retail CBDC has the potential to expand financial inclusion.

This MIT paper asks what are the features of currency technologies, the aspects of peoples’ lives, and the intersections of the two that CBDC designers need to understand most in order to create a digital currency that expands financial inclusion and operates in the public interest, rather than one that exacerbates or even creates a new digital divide for currency?