Bank of Italy urges banks not to delay digital investment

Bank of Italy Deputy Governor Chiara Scotti has urged banks not to postpone digital investment until it is clear which technologies will dominate the market. In her speech, she said that waiting may reduce costs in the short term, but can also delay learning and the creation of future opportunities as the financial system becomes more digital.

Investing in stages

Scotti recommended focusing on investments that are likely to be useful in different scenarios and that support an organisation’s learning process. Banks can assess how new digital technologies fit their business by experimenting with them.

She advised banks to begin with projects on a limited scale. Flexibility and staged commitment can balance caution with innovation, without requiring an early bet on one technological path. This approach helps banks gain experience while limiting the cost of choosing an option that may not become the market standard.

Tokenisation and the role of private money

Scotti also discussed tokenisation, which converts bank deposits into digital tokens that can be transferred on blockchain-based networks. It remains uncertain how widely the technology will be adopted. However, banks need to act if they want to preserve their role as issuers of private money.

Banks and infrastructure providers are already testing these approaches on a limited scale. Matter Labs’ Prividium Commander is designed to help banks move digital asset services, such as tokenised deposits, from pilot projects to production. A partnership between ClearToken and Consensys aims to settle tokenised securities against cash, including tokenised deposits, around the clock.

These projects allow tokenised money to be tested in controlled settings. They reflect the gradual approach to digital investment described by Scotti.