BIS on CBDCs and the Need for Change

Benoît Cœuré, Head of the BIS Innovation Hub, recently spoke at The Eurofi Financial Forum.

The focus of his speech was that central banks need to move faster on Central Bank Digital Currencies (CBDCs), with the private sector already on the move.

Need for change

The pandemic has accelerated the move to non-cash payments whether based on cards, contactless or mobile payments.

QR codes and Buy Now Pay Later have become normal. The Beijing Winter Olympics will see payments made in e-yuan using more than cards and wallets, think gloves, badges, Olympic uniforms.

Challenges

His speech then laid out the challenge of delivering CBDCs while maintaining price stability and financial stability. Central bank money has always delivered safety, finality, liquidity and integrity. It is issued to achieve public policy objectives, not profit. To move central bank money into a digital form, central banks need both to know where they are going, and to get on with it.