Central banks and the new world of paymentsHyun Song ShinEconomic Adviser and Head of Research Basel, Switzerland, 30 June 2020

2

Payments amid the pandemic: greater use of contactless cards

30

32

34

36

38

Oct 2019 Dec 2019 Feb 2020 Apr 2020 Jun 2020

%

Share of contactless payments in global card-present transactions

3

Payments amid the pandemic: pledged fiscal packages

12%

2.4%

9.6%

3%

AEs

EMEs

AEs

EMEs

0.0 2.5 5.0 7.5 10.0 12.5% of GDP

Budgetary Non-budgetary

4

Merchant service costs drive the total cost of card payments

Cash

Debitcards

Creditcards

0 10 20 30 40

Marginal cost, EUR cents

Front office timeBack office labour

Outsourced costsMerchant service costs

Other costs

The economics of the payments marketplace

5

6

7

8

9

An open marketplace

10

An open marketplace

11

An open marketplace

12

An open marketplace

13

An open marketplace

14

An open marketplace

15

An open marketplace

16

An open marketplace

17

The payments marketplace

18

The payments marketplace

CENTRAL BANK

19

0

30

60

90

120

150

82 86 90 94 98 02 06 10 14 18 22

Number of countries

RTGS systems Fast payment systems

Diffusion of retail fast payment systems

Central bank digital currencies (CBDCs)

20

21

Motivations for issuing a general purpose (retail) CBDC

1.0

1.5

2.0

2.5

3.0

Payment Financial Payment efficiency safety/robustness Payment stability Monetary policy (cross-border) Financial

efficiency (domestic) implementation inclusion

Average importance

AEsAverage importance: EMEs

22