Seven financial lenders in South Korea have been authorized to participate in a pilot program testing CBDC-based digital financial services.

South Korea‘s Financial Services Commission has authorized seven domestic banks to participate in a pilot program testing digital financial services based on central bank digital currency and deposit tokens.

The program, announced by the FSC in a Nov. 6 press release, aims to explore the potential of CBDCs in daily transactions. The participating banks, including KB, Shinhan, Woori, and Hana, will issue deposit tokens that represent digital assets backed by bank deposits, the press release reads.

The FSC notes that physical vouchers have traditionally been used to access public services. Now, the country wants to utilize digital vouchers stored on a distributed ledger to provide the same services more conveniently.

According to the regulator, the pilot also includes a digital voucher management platform allowing the government to distribute and track vouchers. However, the FSC did not specify a timeline for the project though.

As the country advances its CBDC expertise, it also continues to strengthen its regulatory framework for the crypto market. In October, Coin Insider Daily reported that South Korea plans to implement new regulations for cross-border virtual asset transactions, including cryptocurrencies, with updated registration and reporting requirements set to take effect in the second half of 2025.