Belgian banking group KBC Group has launched Kate Coin, a European pegged digital token. The tool is designed for use in an organization and its partners’ ecosystem.

According to the press release, Kate Coin is a digital token based on a private blockchain developed by KBC. Private customers will be able to purchase stablecoins through the bank’s mobile app. The lender emphasized that the token has no value outside of the KBC ecosystem.

“The customer can purchase Kate Coins as a loyalty reward when purchasing a certain product or performing certain actions. The tokens can be used to get a discount on another KBC product, for example,” explained Eric Luts, Group Innovation Director.

KBC Group warned that tokens cannot be transferred to other users or exchanged for euros.

Kate Coin is backed by KBC reserves and pegged to the Euro, but it is “not a cryptocurrency or stablecoin”. The organization calls the tool “programmable digital money.”

On June 19, the bank will test the token at the Werchter Boutique music festival. KBC employees will be able to pay for snacks and drinks using Kate Coin.

KBC Group is one of the largest banking institutions in Europe. Managed assets worth ~€340.34 billion at the end of 2021.

Recall that in May 2022, the Belgian Financial Services and Markets Authority introduced mandatory registration of operators of cryptocurrency exchanges and custodian wallets.