Qatar is ushering in a new era of digital payments despite maintaining a ban on digital assets, with its central bank starting a licensing system for digital payment service providers by issuing the first few permits.
Reuters reported that the beneficiary firms are telecom giants Vodafone Qatar and Ooredoo. Vodafone’s iPay and Ooredoo’s Ooredoo Money can now support digital payments under the supervision of the Qatar Central Bank (QCB).
In a tweet, the QCB said the move aims to contribute to the growth of the financial technology sector and to improve financial inclusion. It added that approval for other digital payment service providers will follow soon.
The approval is part of the country’s preparation to host one of the biggest sporting events, the FIFA World Cup, later this year. Qatar has more payment solutions on board for the host of tourists it intends to accommodate.
Last week, QCB announced that it had approved several commercial banks to support Google Wallet, allowing their customers to make mobile payments with Google Pay. The banks include Dukhan Bank, Qatar Islamic Bank, Qatar International Islamic Bank and Qatar National Bank.
Similarly, QCB also now accepts all digital wallet solutions for cards, such as Samsung Pay and Apple Pay.
Qatar is still not interested in digital assets
As it pushes to welcome digital payments, Qatar has imposed a ban on the trading and storage of digital assets since 2020, joining eight other jurisdictions. In a recent interview with Bloomberg, the chief executive officer of the sovereign wealth fund Qatar Investment Authority (QIA) stated that Qatar still has no interest in digital currencies.
Instead, the country wants to make significant investments in blockchain technology, Mansoor bin Ebrahim Al-Mahmoud said. In the same interview, QCB Governor HE Sheikh Bandar bin Mohammed bin Saoud Al Thani labeled digital assets as too risky and volatile.
Meanwhile, QCB has been working on a central bank digital currency (CBDC) that it hopes will help further digitize payments. The QCB, which was first announced in March, said in a June progress update that the development of the digital currency was still in the “foundation phase”.
The central bank governor said the QCB is still examining the pros and cons of issuing a CBDC while looking at the right technology and platform to launch it.
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