Digital ruble: what is known so far

On August 1, a number of federal laws came into force, establishing the legal basis for the circulation of the digital ruble .[1]

On August 15, pilot tests of the digital ruble began in Russia with the participation of a limited number of banks. The introduction of the digital ruble into circulation is expected to begin gradually from 2025.

As part of the review, we propose to consider the key changes that have already taken place[2] in Russian legislation in the process of introducing the digital ruble into circulation.

What is a digital ruble?

The digital ruble is a new digital form of the national currency of the Russian Federation, which is issued by the Bank of Russia in addition to existing forms of money [3] , i.e. the digital ruble is backed by the state's reserves and assets.

When issuing each digital ruble is assigned a unique code, so the Central Bank will be able to trace the entire path of the digital ruble, which will significantly reduce the risk of fraud and corruption using digital rubles.

According to Russian legislation, the ruble has three forms: (1) cash, (2) non-cash and (3) digital. 

At the same time, all forms of the ruble are equivalent, i.e. one cash ruble is equal to one non-cash ruble and, accordingly, one digital ruble.

Operations with the digital ruble will be carried out on the digital ruble platform, and the operator of the platform will be the Bank of Russia. This means that the Central Bank will organize and ensure the smooth functioning and set the rules [4] of the digital ruble platform.

To carry out transactions on the platform, it will be necessary to open a digital ruble account in an authorized bank.

The Board of Directors of the Bank of Russia together with Rosfinmonitoring should determine for the period until December 31, 2024: 

• the range of users of the digital ruble platform;
• a list of types of transactions performed on the platform;
• thresholds for the amounts of such transactions.

Digital ruble account 

A digital ruble account agreement will be concluded between a user, in particular an individual, a legal entity or an individual entrepreneur, and the Bank of Russia, with the credit institution in this structure being an intermediary between the two parties.

A user may open only one digital ruble account. In addition, the digital ruble account agreement does not provide for crediting, charging interest on the digital ruble balance and entering into a joint account agreement. 

Tariffs for digital ruble transactions

The Board of Directors of the Bank of Russia has set tariffs for transactions involving digital roubles:

For citizens, payments and transfers of digital rubles will be free of charge;

• For legal entities: (1) commission for transfers between legal entities will be RUB 15 per transaction; (2) for accepting payment for goods and services with digital rubles will be 0.3% of the payment amount (but not more than RUB 1.5 thousand). At the same time, the tariff for companies providing housing and communal services will be 0.2%, but not more than Br10.
• These tariffs will be effective from January 1, 2025. Until 2025 there is a grace period, according to which all transactions with digital rubles on the platform of the Bank of Russia are free of charge.

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To summarize the above, the digital ruble is a new payment method that is currently at the testing stage. For businesses, the interest in the digital ruble may lie in its significantly lower fees compared to banking. At the same time, the digital ruble is not much different from a cashless form of payment and may not be popular with businesses.

The practical usefulness of the digital ruble will depend directly on the number of users included in the system. In this regard, the success of the introduction of the digital ruble can be assessed as follows.

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[1] No. 339-FZ and No. 340-FZ

[2] Amendments were made to the Civil Code of the Russian Federation; the Federal Law "On Banks and Banking Activity"; the Federal Law "On the Central Bank of the Russian Federation (Bank of Russia)"; the Federal Law "On Insolvency (Bankruptcy)"; the Federal Law "On Currency Regulation and Currency Control"; the Federal Law "On Enforcement Proceedings"; the Federal Law "On the National Payment System"; the Federal Law "On Customs Regulation in the Russian Federation and on Amendments to Certain Legislative Acts"; the Federal Law "On Customs Regulation in the Russian Federation and on Amendments to Certain Legislative Acts of the Russian Federation"; the Federal Law "On Customs Regulation in the Russian Federation and on Amendments to Certain Legislative Acts". 

[3] Website: Digital Ruble | Bank of Russia (cbr.ru)

[4] Regulatory acts of the Bank of Russia establishing conditions for access to the digital ruble platform