The recent enactment of the “Payment Services and Payment Systems Law” is set to play a significant role in advancing the digital payment ecosystem in Azerbaijan. However, it’s worth noting that the law, as it stands, doesn’t contain any provisions related to digital currencies, including the Central Bank’s digital currency, and this sector remains unregulated.
Hayaladdin Tagiyev, the Chief Specialist of the Payment Systems and Settlement Department at the Central Bank of Azerbaijan (CBA), shared insights on this matter with Trend. He explained that currently, most central banks and think tanks worldwide are conducting in-depth research to assess the possibilities of implementing Central Bank Digital Currency (CBDC). To determine the conceptual approach in this direction within Azerbaijan, the CBA availed itself of technical assistance opportunities.
Tagiyev revealed that they have conducted studies focusing on the objectives underlying the creation of CBDC as part of this technical assistance, as well as the structural features, legal and regulatory foundations, and policy implications, including monetary policy, financial stability, and financial inclusion. They have also scrutinized the existing infrastructure of digital payment systems. Furthermore, they closely monitor research and pilot projects conducted in other countries to gain valuable insights.
It’s important to recall that the “Payment Services and Payment Systems Law” was passed by the Milli Majlis (parliament) on July 14 and subsequently signed by the President of Azerbaijan, Ilham Aliyev, on August 9.
The new law is set to bring significant changes to Azerbaijan’s financial landscape by enhancing the efficiency and security of payment services. While it doesn’t encompass digital currencies at present, it lays the groundwork for broader financial innovations and sets the stage for potential regulatory developments in the digital currency arena. As the global landscape of digital payments continues to evolve, Azerbaijan’s financial authorities are closely monitoring international experiences and best practices to ensure they are well-prepared for future developments in the fintech sphere.
FCHAIN Corporation, with its extensive global presence and expertise in finance and legal services, remains committed to supporting businesses in navigating these dynamic changes and seizing new opportunities in Azerbaijan’s evolving financial landscape.
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