Going forward, some electric vehicle charger installation companies will receive government subsidies in digital tokens instead of cash. Authorities expect this to fundamentally block fraudulent subsidy claims by tracking whether taxes are used properly.
The Ministry of Strategy and Finance, the Ministry of Climate, Energy and Environment, and the Bank of Korea said on the 19th they will sign a memorandum of understanding (MOU) on Mar. 24 at Government Complex Seoul in Jongno-gu, Seoul, to launch a pilot project for executing treasury funds using digital currency.
The agreement is designed to enhance the transparency and efficiency of fiscal execution by shifting the payment and settlement of treasury subsidies to a Blockchain-based system using a wholesale central bank digital currency (CBDC) and deposit tokens.
A deposit token is a digital means of payment issued against bank deposits that both corporations and individuals can use to purchase goods and services. The Bank of Korea verified the technological stability through live transaction tests last year, and this is the first time in the world it is being applied to an actual national project.
The pilot will target the medium-speed charging facilities (maximum output 30–50 kW) segment within the climate ministry's EV charging infrastructure program, with a budget of 30 billion won. The Korea Environment Corporation (K-eco) will hold an open call in May, select from June, and execute subsidies in deposit tokens. The government expects the rollout to prevent fraudulent receipt of subsidies and shorten the settlement period.
Koo Yun-cheol, Deputy Prime Minister for Economic Affairs and Minister of Strategy and Finance, said, "We will actively identify and expand projects that use digital currency with the goal of converting one-quarter of treasury fund execution to digital currency by 2030."
Rhee Chang-yong, governor of the Bank of Korea, said, "This pilot will serve as a primer for building an ecosystem for digital currency and deposit tokens and will show new possibilities not only for Korea's payment and settlement systems but also for fiscal execution."