Electronic banking: Strategy, monetary policy and the central bank(s)H. VAN DE VYVER

CELUFO SNC, BRUSSELS

Regulatory Issues and Possible Policy Responses to the development of E-money

◦ Fundamental monetary policy concerns

◦ Efficient functioning of payment systems and confidence in payment instruments

◦ Protection of customers and merchants

◦ Stability of financial markets

◦ Protection against criminal abuse

Source: Issues in Informing Science and Information Technology Volume 6, 2009

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Strategy, monetary policy and the central bank(s)

The idea that digital money is commodity based may be overly optimistic. The possibility of fraud could lead the central bank to want to limit the changes to M1 and prevent the growth of electronic money. The following measures could be taken:

• Limit the proliferation of digital money products to prevent the replacement of central

bank currency

• Issue digital money products and treat digital money balances in the same way as they do

central bank currency

• Apply high reserve requirements on digital money balances

• Absorb the excess liquidity created by appropriate monetary operations

Source: Issues in Informing Science and Information Technology Volume 6, 2009

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Strategy, monetary policy and the central bank(s)

Strategy, monetary policy and the central bank(s)

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E-money associaction◦ International:

◦ Website:http://www.e-ma.org

◦ Blog, Publications

◦ Europe:◦ Website: http://ec.europa.eu/internal_market/payments/emoney/index_en.htm

◦ Directive about e-money institutions

Other institutions• FATF

• recommendations• The Wolfsberg group

• standards

European central bank◦ ECB, website: http://www.ecb.europa.eu/pub/pdf/scplps/ecblwp7.pdf

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Strategy, monetary policy and the central bank(s)

Strategy, monetary policy and the central bank(s)

Russia◦ Website: http://npaed.ru

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Strategy, monetary policy and the central bank(s)

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The new E-Money Directive (2009/110/EC) (EMD) aims to:◦ enable new, innovative and secure electronic money services to be designed

◦ provide market access to new companies

◦ foster real and effective competition between all market participants.

Strategy, monetary policy and the central bank(s)

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The second Electronic Money Directive (2EMD), which aims to encourage the growth of the electronic money market, was implemented in the UK on 30 April 2011 through the Electronic Money Regulations 2011.

Strategy, monetary policy and the central bank(s)

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Source: ECB, Legal working paper

Strategy, monetary policy and the central bank(s)

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Source: ECB, Legal working paper

Strategy, monetary policy and the central bank(s)

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Source: ECB, Legal working paper

Strategy, monetary policy and the central bank(s)

http://www.ecb.europa.eu/press/key/date/2014/html/sp141017_2.en.html

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Electronic banking: Strategy, monetary policy and the central bank(s)

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