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Digital hryvnia is on its way. Zelensky signed the law

Volodymyr Zelenskyy signed the Law "On Payment Services". Photo: President's website

Volodymyr Zelenskyy signed the Law "On Payment Services". Photo: President's website

President Volodymyr Zelenskyy signed the Law "On Payment Services" due to which the National Bank will be able to issue digital hryvnia. Parliament adopted it on June 30, 2021.

As reported on the website of the Office of the President, the law will facilitate the development of the payment services market and the imposition of innovations in the country's financial sector.

The main provisions of the law on digital hryvnia:

  • the document adapts the law of Ukraine to the legislation of the European Union, which later will help to integrate the country's payment system with the EU;
  • The NBU will be able to issue the "digital currency of the National Bank of Ukraine" and create a platform for testing services, technologies, and tools in the payment market that are based on innovative technologies. The law defines the national digital currency as "an electronic form of the monetary unit of Ukraine, the issuer of which is the National Bank." According to the document, CBDC is legal payment facility in the country;
  • the law strengthens the protection of the rights of the payment services consumers and ensures the transparency of their provision;
  • there will be nine categories of payment service providers operating in Ukraine. Electronic money institutions, branches of foreign payment institutions, service providers of information from accounts, payment institutions will be established;
  • nine payment services will operate in the country (two of them will be non-financial);
  • the document creates conditions in Ukraine for launching the open banking concept. It should start working in 2023;
  • the law increases liability for illegal actions with payment instruments and facilities of access to bank and payment accounts.

Context. The Verkhovna Rada adopted the law In the first reading in May 2021, and in the second—at the end of June.

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