Central Bank Digital Currency and Financial Inclusion PDF Download
Are you looking for read ebook online? Search for your book and save it on your Kindle device, PC, phones or tablets. Download Central Bank Digital Currency and Financial Inclusion PDF full book. Access full book title Central Bank Digital Currency and Financial Inclusion by Brandon Tan. Download full books in PDF and EPUB format.
Author: Brandon Tan
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 50
Get Book
Book Description
In this paper, we develop a model incorporating the impact of financial inclusion to study the implications of introducing a retail central bank digital currency (CBDC). CBDCs in developing countries (unlike in advanced countries) have the potential to bank large unbanked populations and boost financial inclusion which can increase overall lending and reduce bank disintermediation risks. Our model captures two key channels. First, CBDC issuance can increase bank deposits from the previously unbanked by incentivizing the opening of bank accounts for access to CBDC wallets (offsetting potential flows from deposits to CBDCs among those already banked). Second, data from CBDC usage allows for the building of credit to reduce credit-risk information asymmetry in lending. We find that CBDC can increase overall lending if (1) bank deposit liquidity risk is low, (2) the size and relative wealth of the previously unbanked population is large, and (3) CBDC is valuable to households as a means of payment or for credit-building. CBDC can still be optimal for household welfare even when overall lending decreases as households benefit from the value of using CBDC for payments, CBDC provides an alternative "safe" savings vehicle, and CBDC generates greater surplus in lending by reducing credit-risk information asymmetry. Most countries are considering a "two-tier" CBDC model, where central banks issue CBDC to commercial banks which in turn distribute them to consumers. If non-bank payment system providers can distribute CBDC, fewer funds will flow into deposit accounts from the unbanked because a bank account is no longer needed to access CBDC. If CBDC data is shareable with banks, those without bank accounts can still build credit and access lower interest rate loans. This design is optimal for welfare if the gains from greater access to CBDC outweigh the contraction in lending.
Author: Brandon Tan
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 50
Get Book
Book Description
In this paper, we develop a model incorporating the impact of financial inclusion to study the implications of introducing a retail central bank digital currency (CBDC). CBDCs in developing countries (unlike in advanced countries) have the potential to bank large unbanked populations and boost financial inclusion which can increase overall lending and reduce bank disintermediation risks. Our model captures two key channels. First, CBDC issuance can increase bank deposits from the previously unbanked by incentivizing the opening of bank accounts for access to CBDC wallets (offsetting potential flows from deposits to CBDCs among those already banked). Second, data from CBDC usage allows for the building of credit to reduce credit-risk information asymmetry in lending. We find that CBDC can increase overall lending if (1) bank deposit liquidity risk is low, (2) the size and relative wealth of the previously unbanked population is large, and (3) CBDC is valuable to households as a means of payment or for credit-building. CBDC can still be optimal for household welfare even when overall lending decreases as households benefit from the value of using CBDC for payments, CBDC provides an alternative "safe" savings vehicle, and CBDC generates greater surplus in lending by reducing credit-risk information asymmetry. Most countries are considering a "two-tier" CBDC model, where central banks issue CBDC to commercial banks which in turn distribute them to consumers. If non-bank payment system providers can distribute CBDC, fewer funds will flow into deposit accounts from the unbanked because a bank account is no longer needed to access CBDC. If CBDC data is shareable with banks, those without bank accounts can still build credit and access lower interest rate loans. This design is optimal for welfare if the gains from greater access to CBDC outweigh the contraction in lending.
Author: Marlene Amstad
Publisher: Asian Development Bank
ISBN: 9784899742135
Category : Business & Economics
Languages : en
Pages : 400
Get Book
Book Description
This book provides a thorough introduction and historical overview of the principles and practices of digital currency and fintech in Asia. It covers the theory of central bank digital currency and examines regulatory aspects, economic digitalization, financial inclusion, and the role of SMEs. Selected case studies offer in-depth insights into recent fintech developments in major economies, including Australia; Hong Kong, China; Indonesia; Japan; the People's Republic of China; the Republic of Korea; and Thailand. The book also makes a valuable supplement for introductory courses on finance, governance, and economics, as it appeals to a broad range of readers, including university students, academics, finance practitioners, and policy makers.
Author: Marlene Amstad
Publisher: Brookings Institution Press
ISBN: 4899742142
Category : Business & Economics
Languages : en
Pages : 0
Get Book
Book Description
This book provides a thorough introduction and historical overview of the principles and practices of digital currency and fintech in Asia. It covers the theory of central bank digital currency and examines regulatory aspects, economic digitalization, financial inclusion, and the role of SMEs. Selected case studies offer in-depth insights into recent fintech developments in major economies, including Australia; Hong Kong, China; Indonesia; Japan; the People’s Republic of China; the Republic of Korea; and Thailand. The book also makes a valuable supplement for introductory courses on finance, governance, and economics, as it appeals to a broad range of readers, including university students, academics, finance practitioners, and policy makers.
Author: Ashley Lannquist
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 37
Get Book
Book Description
Financial inclusion is a key policy objective that central banks, especially those in emerging and low-income countries, are considering for retail central bank digital currency (CBDC). If properly designed to address the barriers to financial inclusion, CBDCs have the opportunity to gain acceptance by the financially excluded for digital payments. CBDC can then serve as an entry point to the broader formal financial system. CBDC has special aspects that may benefit financial inclusion, such as being a risk-free and widely acceptable form of digital money, availability for offline payments, and potentially lower costs and greater accessibility. However, CBDC is not a panacea to financial inclusion, and additional experience is needed to fully understand its potential impact.
Author: Asian Development Bank
Publisher: Asian Development Bank
ISBN: 929270091X
Category : Business & Economics
Languages : en
Pages : 91
Get Book
Book Description
Asia and the Pacific continues to experience rapid development of innovative technology solutions driven by increased government support to help address the economic fallout of the coronavirus disease pandemic. This publication identifies the role that central bank digital currencies could play in overcoming some of the challenges of achieving financial inclusion. It proposes recommendations to aid policy makers and regulators. The publication shares insights from the Asia–Pacific Financial Inclusion Forum, a policy initiative of the Asia–Pacific Economic Cooperation Finance Ministers’ Process.
Author: Kaur, Guneet
Publisher: IGI Global
ISBN:
Category : Business & Economics
Languages : en
Pages : 380
Get Book
Book Description
In the ever-evolving landscape of global finance, the rise of Central Bank Digital Currencies (CBDCs) has introduced a myriad of challenges that demand immediate scholarly attention. The accelerating pace of digital transformation, coupled with the intricate dynamics of these novel currencies, poses significant hurdles in their widespread adoption. From privacy concerns to the technological complexities involved, the academic community finds itself at the forefront of deciphering the multifaceted challenges inherent in the CBDC landscape. Addressing this imperative need for comprehensive analysis is the groundbreaking publication, Exploring Central Bank Digital Currencies: Concepts, Frameworks, Models, and Challenges. Within the pages of this compelling work, scholars will encounter a meticulous exploration of the intricate evolution of money, navigating from traditional barter systems to the digital era. The catalytic role of Bitcoin in reshaping the financial landscape serves as a cornerstone, laying the foundation for a profound understanding of the cryptocurrency fundamentals that underpin CBDCs. This book delves into the conceptual frameworks and technological models shaping CBDCs, aiming to illuminate the complex challenges faced by central banks, governments, and financial institutions in their pursuit of digital currency integration.
Author: Mr.Tommaso Mancini Griffoli
Publisher: International Monetary Fund
ISBN: 1484384571
Category : Business & Economics
Languages : en
Pages : 39
Get Book
Book Description
Digitalization is reshaping economic activity, shrinking the role of cash, and spurring new digital forms of money. Central banks have been pondering wheter and how to adapt. One possibility is central bank digital currency (CBDC)-- a widely accessible digital form of fiat money that could be legal tender. This discussion note proposes a conceptual framework to assess the case for CBDC adoption from the perspective of users and central banks. It discusses possible CBDC designs, and explores potential benefits and costs, with a focus on the impact on monetary policy, financial stability, and integrity. This note also surveys research and pilot studies on CBDC by central banks around the world.
Author: Mr.Itai Agur
Publisher: International Monetary Fund
ISBN: 1513519883
Category : Business & Economics
Languages : en
Pages : 38
Get Book
Book Description
We study the optimal design of a central bank digital currency (CBDC) in an environment where agents sort into cash, CBDC and bank deposits according to their preferences over anonymity and security; and where network effects make the convenience of payment instruments dependent on the number of their users. CBDC can be designed with attributes similar to cash or deposits, and can be interest-bearing: a CBDC that closely competes with deposits depresses bank credit and output, while a cash-like CBDC may lead to the disappearance of cash. Then, the optimal CBDC design trades off bank intermediation against the social value of maintaining diverse payment instruments. When network effects matter, an interest-bearing CBDC alleviates the central bank's tradeoff.
Author: Gabriel Soderberg
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 43
Get Book
Book Description
Digitalization of the economy provides both challenges and opportunities. Central banks should ensure that they have the capacity to continue to meet their policy objectives in the digital age. It is in this context that central bank digital currency (CBDC) should be evaluated. If designed appropriately, CBDCs could allow central banks to modernize payment systems and future-proof central bank money as the pace and shape of digitalization continues to evolve. However, the decision to proceed with CBDC exploration and an eventual launch would need to be jurisdiction specific, depending on the degree of digitalization of the economy, the legal and regulatory frameworks, and the central bank’s internal capacity. This paper proposes a dynamic decision-making framework under which the central bank can make decisions under uncertainty. A phased and iterative approach could allow central banks to adjust the pace, scale, and scope of their CBDC projects as the domestic and international environment changes.
Author: Muhammad Ashfaq
Publisher: Walter de Gruyter GmbH & Co KG
ISBN: 3110982390
Category : Business & Economics
Languages : en
Pages : 180
Get Book
Book Description
Central Bank Digital Currencies and Global Financial System: Theory and Practice is the perfect book for anyone interested in the impact of digital currencies on the global financial system, providing valuable insights and analysis on the topic. The topic of central bank digital currencies (CBDCs) is particularly relevant in 2023 because the use of digital currencies is rapidly growing around the world, and many central banks are exploring the idea of developing their own CBDCs. This book offers readers an opportunity to gain a better understanding of CBDCs, including their history, differences with cryptocurrencies, and the potential impact of CBDCs on the future of the financial system. The book’s didactic approach breaks down complex topics into easily digestible chapters, allowing readers to easily understand and follow the progression of digital currencies. For those interested in the future of digital currencies, the book offers a chapter on future research directions and concluding remarks. Central Bank Digital Currencies and Global Financial System: Theory and Practice is a must-read for anyone interested in the intersection of finance and technology. By exploring the evolution of digital currencies and their impact on the global financial system, this book provides valuable insights for policymakers, financial professionals, and anyone looking to understand the future of money.
