Japan is taking a measured but attentive arroyo to global interest in cardinal depository financial institution digital currency issuance. In his latest remarks published on Tuesday, Bank of Nihon Governor Kuroda Haruhiko noted that the institution has not changed its stance and still does not currently accept a physical plan to issue a CBDC.

However, this non-commitment does not mean inactivity on the CBDC enquiry and development front end by whatsoever means. In Oct 2020, Japan's central depository financial institution pledged to brainstorm the first of several testing phases for its own CBDC proof-of-concept. Haruhiko has at present confirmed that these are due to begin this spring.

The governor underscored that, as per a Bank of International Settlements report, 86% of key banks globally are currently exploring the benefits and downsides of CBDCs. Of these, 60% are already at an experimental or proof-of-concept stage of evolution. Haruhiko noted:

"Central banks share the view that it is not an appropriate policy response to start considering CBDC only when the need to issue CBDC arises in the hereafter."

Haruhiko said that "From the viewpoint of ensuring the stability and efficiency of the overall payment and settlement systems, nosotros consider it important to prepare thoroughly to respond to changes in circumstances in an appropriate manner." Taking into consideration the "pregnant changes" that are underway in an increasingly digital guild, he signaled that the banking company is taking the opportunity to carefully counterbalance the various approaches to potential changes in central bank money provision.

Haruhiko went then far every bit to grouping these emergent approaches under the theme of "Central Banking-as-a-Service." In his wider account of these trends, he argued that "every bit-a-service" is an emerging tendency in finance more broadly, transposed from earlier developments in the corporate and software spheres. This implies a motion toward amalgam business models that hinge on providing services on client need, rather than taking a traditional sales approach centered on products.

"Everything as a Service," every bit Haruhiko noted, now spans phenomena such equally mobility-equally-a-service (purchasing a mobility service rather than a auto) and infrastructure-as-a-service, which increasingly makes information technology redundant for firms to own certain hardware. In the framework of finance, he summarized:

"There is also a recent tendency toward unbundling financial services that financial institutions used to provide as tightly coupled, thereby enabling componentized financial services to be combined with services of non-financial firms. This is referred to as 'Banking equally a Service' [...] as well known equally embedded finance."

The Bank of Japan has been tracking innovations beyond public and individual finance closely, cooperating with the Depository financial institution for International Settlements and five other major global banks on CBDC inquiry since January 2020 and devoting attending to issues such as offline availability when it comes to supporting a digital currency.