The central bank of Laos has started testing a national digital currency, with the aim of facilitating the population's access to financial services, in one of the poorest countries in Southeast Asia, reported the Lusa agency.
The test is being conducted with the help of a Japanese blockchain technology company.
The 'blockchain' is a decentralized record of transactions, a digital database, a technology underlying Bitcoin and other cryptocurrencies, but which has the potential to support a wide variety of businesses.
National digital currencies and cryptocurrencies share 'blockchain' technology, but differ in essence.
In cryptocurrencies the system is decentralized and the user remains anonymous. These digital currencies are issued and regulated by a central authority.
The central bank of Laos and Japanese company Soramitsu on Monday signed a memorandum of understanding to launch the national digital currency, according to Japanese economic daily Nikkei Asia.
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The currency will be distributed to customers at commercial banks and can be used as a means of payment in companies in Laos, as well as transferred by scanning QR codes on mobile phones, without the need for a bank account.
Laos seeks to make financial services more accessible to the population in this way, in a country where around 70% of the 7,5 million people do not have a bank account.
The nation, among the poorest in Southeast Asia, will also explore digital transactions with Cambodia, where Soramitsu already helped launch the digital currency, Bakong, in October 2020.
Vietnam, Philippines, Thailand and Singapore are other countries in the region that are exploring the benefits of a digital national currency, allowing them to maintain greater control over monetary policies, but also over citizens' transactions.
