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BIS Researchers Say Coronavirus Could Spur Central Banks to Adopt Digital Payments


BIS Researchers Say Coronavirus Could Spur Central Banks to Adopt Digital Payments

Researchers at the Bank for International Settlements (BIS) think COVID-19 may accelerate the adoption of digital payments and sharpen the debate over central bank digital currencies (CBDC). They issued their forecast in BIS’ April 3 Bulletin. COVID-19 is changing the public's relationship with cash, they said, despite the scientific community’s consensus that coronavirus transmission via banknote is relatively unlikely. “Irrespective of whether concerns are justified or not, perceptions that cash could spread pathogens may change payment behaviour by users and firms,” the researchers said. For starters, countries may expand digital payment infrastructure with more online, mobile and contactless options after COVID-19. Digital adoption actions could have an “especially severe impact” on millions of older and unbanked people, though. “If cash is not generally accepted as a means of payment, this could open a ‘payments divide’ between those with access to digital payments and those without,” researchers said. Cash may therefore stage a comeback, the researchers admitted, but the pandemic “also calls for CBDCs.” Read More...