Citi, in partnership with Imperial College Business School has launched its latest Digital Money Index.
The index, now in its sixth year, tracks 84 countries in terms of their development of digital money readiness.
For the first time, the report compares historical data collated over the last five years, rather than year on year, concluding a 5.5% improvement in overall digital money readiness for the 84 countries tracked.
Naveed Sultan, Global Head, Treasury and Trade Solutions, Citi, commented: “The benefits of digital money have long been apparent and well-articulated by Citi. Increasingly, there is clear evidence that countries are recognizing the potential gains offered by digital money. We are delighted to be working with Imperial on the next edition of the index, and believe that this data and associated case studies provide truly valuable information and reflect Citi’s approach to collaborate with academia, policy makers and regulators to advance the financial infrastructure around the world to be compatible with today’s increasingly digital economy.”
The index groups countries into four clusters of digital money readiness- incipient, emerging, in-transition and materially ready. Although substantial improvements can be seen for each cluster over the past five years, the report highlights that the biggest shift has come from the incipient and in-transition countries, showing a higher than average increase in readiness.
Naveed Sultan, who also Chairs the Advisory Board for Imperial’s Centre for Global Finance and Technology at Imperial College Business School continued: “The index has shown that countries at an earlier stage of readiness typically face challenges relating to lack of financial and communications infrastructure, as well as access to basic financial services. Those that are more mature face challenges relating to availability and adoption of digital money solutions.”
Of the total number of countries in the index, this year’s report concludes that 18 countries (~22%) have advanced from one cluster to the next over the last five years, reflecting the increase in digital readiness. Countries that have advanced in to the next cluster have addressed typical bottlenecks characteristic of their peers. This shift in clusters has resulted in 50% more materially ready countries in 2019 and a 20% reduction in the number of countries in the incipient cluster.
Andrei Kirilenko, Director of the Centre for Global Finance and Technology at Imperial College Business School said: “For the first time in the Index’s six year history, we’ve been able to track changes across the time period, highlighting trends which are more cumulative than annual. This is reflective of how digital transformation actually works, while illustrating key bottlenecks. This information is tremendously valuable to policymakers from incipient and in-transition economies”.