At an event on Thursday, Ida Wolden Bache, Deputy Governor of the Central Bank of Norway, described a drop in cash payments while talking about central bank digital currencies, or CBDC for its acronym in English.
“Only 4% of payments are now made in cash”, Bache said in his speech at Finance Norway’s payments conference. “This percentage is roughly the same as in spring and significantly lower than before the pandemic.” added. “As far as we know, the percentage of cash payments is lower in Norway than in any other country.”
Norway used the Norwegian krone or krona, the currency of the country’s central bank, Norges Bank. After concerns about COVID-19 emerged in March, there were logically common contacts They became worrying for the countries. This includes physical coins that are constantly changing hands.
CBDCs also turned out to be a very relevant topic in 2020. Many nations in the world will publish such a digital asset, and China shows evidence of its wealth.
“A trend that is specific to Norway and some of our neighboring countries is low and declining cash consumption.” Bache said after detailing various aspects of the global CBDC scene.
The central bank’s monetary policy director mentioned the outstanding properties of cash. Cash remains available if, for example, digital payment systems fail. “Cash is the generally accessible legal tender”, said. The country could lose some of these aspects if fully digitized with a CBDC.
“The question is if something important is lost when the money runs out and No We are introducing a CBDC. Is central bank money critical to confidence in the monetary system? Could a CBDC offer more than cash can deliver in terms of a wider variety of uses and more innovation? “”
Bache also addressed a number of other points to consider when launching a CBDC in Norway. “The possible introduction of a CBDC is still a long way off”, he said, adding:
“The lack of urgency reflects our previous view that the introduction of a CBDC is not absolutely necessary. The introduction of a CBDC could have significant consequences in several areas. Our decision must be well-founded.”
As for progress, the Central Bank of Norway continues to investigate CBDCs. The Brazilian Economy Minister yesterday confirmed the search for a CBDC for the country.