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Central Bank Digital Currency (CBDC) for small and medium-sized businesses and supply chains: opportunities and challenges

Start date

December 2023

End date

December 2024


A Central Bank Digital Currency (CBDC) is a digital form of a country's national currency issued by its central bank. Unlike cryptocurrencies such as Bitcoin or Ethereum, CBDCs are typically considered legal tender and are directly backed by the government. 
Worldwide, central banks, including the Bank of England are exploring ways to offer their citizens a safe and reliable CBDC, because they can be universally accepted and improve financial inclusion by providing a digital, secure, and accessible form of money for individuals who do not yet hold bank accounts.
There are also sizeable benefits to business, which include reduced transaction costs, faster and more efficient cross-border transactions, the ability to implement innovative monetary policy measures, improvements to supply chain data sharing, financial data sharing and invoicing, and increased levels of security.
This ESRC IAA-funded project will explore the opportunities that CBDCs offer to small businesses, and the challenges that need addressing before widespread adoption occurs. These include privacy, security, GDPR, interoperability and the infrastructure of CBDC operating models, and addressing them will require careful planning, collaboration between stakeholders, and ongoing adaptation to the evolving economic and technological landscape.
Dr Vahid Mirzabeiki from the Surrey Business School and partner organisation Portdex, will identify the regulatory frameworks needed, the possibility for interoperability across borders, and the feasibility of CBDC for peer-to-peer money transactions in supply chains between individuals and businesses.


Exploring Opportunities

Planned Impact

The aim of this ESRC IAA-funded project is to provide a careful business analysis and feasibility study for CBDC uptake, prior to developing a network for peer-to-peer digital currency transactions, while digital currency is being created by the central banks and digital transactions are becoming regulated.
The outputs of the project - a series of detailed reports - will be shared widely with central banks, stakeholders, policymakers and parliamentary groups, and will contribute to the advancement of digital currency initiatives worldwide. 
The team hopes ESRC IAA funding will lead to wider investment in this area of work and achieve widespread change in the approach to CBDCs for the benefit of financial organisations, businesses and ultimately the consumer.