RBA eaud

The RBA Boss is “Sceptical” About an Aussie Digital Dollar, But Could He Be Wrong?

3 min read

This article is for general information purposes only and isn’t intended to be financial product advice. You should always obtain your own independent advice before making any financial decisions. The Chainsaw and its contributors aren’t liable for any decisions based on this content.



Dr Phillip Lowe, the Governor of the Reserve Bank of Australia (RBA) has voiced his concerns that use cases for a digital Australian dollar — dubbed the ‘eAUD’ — may be lacking.

Speaking at the Australian Financial Review’s Business Summit, Dr Lowe said that he was “very sceptical” that a central bank digital currency (CBDC) will have any substantial impact on the daily lives of regular Australians.

RBA cbdc Dr Phillip Lowe
Dr Philip Lowe, governor of the RBA, has shared his concerns over the retail use cases of a digital Australian dollar.

Dr Phillip Lowe” Criticism

To bolster his criticism of the usefulness of the eAUD for regular Australians, Dr Lowe points to the prevalence of fast, simple money transfers through the pre-existing payment networks already available to Australian consumers.

“We’ve got a very efficient payment system in Australia where you can move money between any two bank accounts in the country in five seconds, just by knowing someone’s mobile phone number. And it’s free,” said Lowe.

Lowe went on to say that the primary benefits of an Australian CBDC are most probably going to be discovered in wholesale and institutional markets, where the new digital dollar’s blockchain technology will see large settlements occur instantly.

But not everyone shares Lowe’s critical approach to the retail side of a digital Aussie dollar. Steve Vallas, the Technology Advisor at Skafold Global and Managing Director at Blockchain APAC told The Chainsaw that,

“Lowe is right to say there’s not a strong use case for a retail CBDC in Australia right now, but ultimately it’s missing the point,” Vallas explains.

“The thing that gets lost in this discussion is that other jurisdictions don’t have great quality retail payments infrastructure, and they’re going to start rolling out retail CBDCs in a bid to improve their financial systems.”

britcoin UK Britain cbdc digital pound CBDC CBDCs digital dollar Crypto Dollar Australian CBDC: Dr Phillip Lowe
Dr Phillip Lowe: Sceptical


Vallas likens the dawn of retail CBDCs around the globe to the difference between desktop computers and mobile phones. To Vallas, Australia is currently in the desktop computer business but the rest of the world is looking to go “mobile”, as other countries move to embrace retail digital dollars as an upgrade to existing payment rails.

“This idea of ‘if it’s not broke, don’t fix it’ works well for now. And it’s right. Our consumer payments system is pretty good at the moment, but the real question is what happens when everyone else starts introducing retail CBDCs and we’re inevitably left behind?” Vallas asks.

“There’s an economic opportunity that comes with being at front of this conversation, instead of waiting three, five, or even ten years to catch up once everyone else introduces a retail CBDC.”

Steve Vallas, Managing Director at Blockchain APAC

“The idea of ‘let’s wait until everyone else has figured this out’ puts us as a country on the back foot when it comes to real innovation,” Vallas said.

“Essentially, does Australia have a way to compete with other jurisdictions if and when this technology inevitably takes off at a consumer level in other countries?” Vallas concludes.

The RBA just launched the eAUD pilot program

Lowe’s criticisms come exactly one week after the Reserve Bank of Australia launched the next major step in its pilot program for testing out potential use cases for a digital Australian dollar.

On March 2, the RBA announced that Commonwealth Bank and the Australian New Zealand Bank (ANZ) will work alongside 12 other financial institutions, including smaller fintech and payments companies to begin testing out the first instance of a real AUD-based CBDC.

In a joint statement from the Reserve Bank of Australia and the Digital Finance Cooperative Research Centre, RBA Assistant Governor Brad Jones said the program will achieve two primary goals.

“It will contribute to hands-on learning by industry, and it will add to policymakers’ understanding of how a CBDC could potentially benefit the Australian financial system and economy.”

RBA Assistant Governor Brad Jones

The pilot project will officially launch on March 31 and finish on May 31. A final report on the program, including an assessment on the effectiveness of all the use cases is scheduled to be published June 30 this year.