Central banks and the new world of payments

Speech by Mr Hyun Song Shin, Economic Adviser and Head of Research of the BIS, on the occasion of the Bank's Annual General Meeting, Basel, 30 June 2020.

Digital innovation is radically reshaping the provision of payment services. Yet technology by itself is not sufficient to put in place a fast, efficient and cost-effective payment system. The Covid-19 pandemic has accelerated trends that were already under way and highlighted how financial services need to be more inclusive and accessible. In this context, the central bank can play the pivotal role as the operator of the underlying infrastructure, catalyst for innovation and overseer of the system. Central bank digital currencies (CBDCs) may be an important step in the evolution of the relationship of the central bank with society. All of these developments make central bank public goods more important than ever, and central banks need to be at the cutting edge of technology to serve society.