South Africa is not alone in reconsidering its central bank digital currency (CBDC) plans.
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- The South African Reserve Bank has postponed retail CBDCs and is instead prioritizing payment system modernization and wholesale digital currency projects.
- The initiative aims to make digital services faster and more affordable and improve connectivity between financial institutions.
- The central bank warned of the risks posed by cryptocurrencies and stablecoins and emphasized regulatory measures and licensing of crypto service providers to maintain financial stability.
The rollout of CBDCs faces a series of obstacles in 2025, as several countries look to pause or delay efforts to introduce state-backed digital currencies amid major changes in the global financial landscape.
A combination of economic uncertainty, regulatory challenges, and concerns about market readiness have led central banks to reconsider the risks of entering digital currency pools.
South Africa has flaws in its national payments system
According to the bank’s findings, around 16% of South African adults remain unbanked and many still rely on cash for most transactions. The agency seeks to expand access through faster and more affordable digital services.
The bank said a retail CBDC should replicate the characteristics of physical cash, including offline functionality, wide acceptance, a simple user interface, and robust privacy protections. According to a new report, these criteria must be met before deployment can begin.
Recent efforts have focused on updating payment infrastructure and improving connectivity between financial institutions, which the bank believes will help establish the foundation for digital finance. The report notes that retail CBDCs could be integrated into this system at a later stage when the benefits outweigh the costs. The document notes the slow rate of adoption in several countries that have adopted digital currencies, which it says has influenced South Africa’s cautious approach.
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Other scenarios
- South Korea: of bank of korea has officially canceled its ambitious CBDC project “Project Han River” and signaled a suspension of plans to test the digital won. The move comes as the country faces increasing competition from stablecoins and private digital payment solutions and instead shifts its focus to improving existing payments infrastructure.
- England: In a surprising change of direction, bank of england has indicated its intention to slow down the pace of its ‘digital pound’ project, suggesting that private sector solutions could be a more viable alternative to national cryptocurrencies. Due to the fluid economic situation, the Bank has opted for further evaluation rather than immediate action.
- global trendsAccording to a 2025 report by: Homme 5 (Official Currency and Financial Institutions Forum), 31% of central banks worldwide Delayed or suspended CBDC plans. This trend, from emerging to developed economies, highlights growing concerns that, despite its potential, CBDCs are not yet established as a solution to modernizing payment systems.
What is causing the delay?
Several factors are behind the CBDC slowdown. The main concern is continued regulatory uncertainty surrounding stablecoins, whose rise has caused central banks to reconsider the need for their own digital currencies. Countries like South Korea are instead shifting their focus to stablecoin legislation, while others like the UK are pondering whether similar goals can be achieved with private solutions without the need for a fully state-run system.
It is difficult to economically justify the cost and complexity of launching a national digital currency if the existing system continues to serve its purpose. In countries such as South Korea and the UK, governments are choosing to direct resources to other important economic issues rather than promoting digital currencies. Additionally, some central banks are concerned about general adoption, fearing that CBDCs could face slow adoption or opposition from citizens accustomed to traditional banking systems.
A global pause or just a pause?
Delays in CBDC projects made headlines in 2025, but this is not an overarching trend. Indeed, many emerging markets, particularly in parts of the Middle East and Africa, are accelerating the development of CBDCs as digital currencies can help promote financial inclusion. These markets are also facing increased competition from China’s digital yuan, which is already in circulation in some regions, prompting other countries to hasten their own plans.
But for now, the majority of developed countries appear to be putting the brakes on digital currencies, either reassessing the economic impact or waiting for stablecoin regulations to stabilize digital asset markets before moving deeper into the CBDC space.
