Digital currencies and fintech
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Cash and COVID-19: The Effects of Lifting Containment Measures on Cash Demand and Use
Using Bank Note Distribution System data on the demand for cash up to September 2020, we find that demand was strong. This is true even though cash use for payments declined early in the pandemic. When mobility restrictions and lockdown measures were eased, cash use for payments increased sharply but remained less popular than electronic methods of payment. -
February 11, 2021
Canadian universities propose designs for a central bank digital currency
The Bank of Canada is researching potential system designs and business models for a digital currency that, like a banknote, would be widely accessible, secure and denominated in Canadian dollars. -
February 10, 2021
Changing how we pay
Deputy Governor Timothy Lane discusses how the pandemic has accelerated the digitalization of the economy. -
February 10, 2021
Payments innovation beyond the pandemic
Deputy Governor Timothy Lane talks about how the Bank of Canada is contributing to the modernization of our payments ecosystem, and how the COVID-19 pandemic has highlighted the need to make payments more convenient for all Canadians. -
Estimating Policy Functions in Payments Systems Using Reinforcement Learning
We demonstrate the ability of reinforcement learning techniques to estimate the best-response functions of banks participating in high-value payments systems—a real-world strategic game of incomplete information. -
Eggs in One Basket: Security and Convenience of Digital Currencies
Digital currencies store balances in anonymous electronic addresses. This paper analyzes the trade-offs between the safety and convenience of aggregating balances in addresses, electronic wallets and banks. -
Losing Contact: The Impact of Contactless Payments on Cash Usage
Contactless payment cards are a competitive alternative to cash. Using Canadian panel data from 2010 to 2017, this study investigates whether contactless credit cards are an important contributor to the decline in the transactional use of cash. -
Safe Payments
In a cashless economy, would the private sector invest in the optimal level of safety in a deposit-based payment system? In general, because of externalities, the answer is no. While the private sector could over- or under-invest in safety, the government can use taxes or subsidies to correct private incentives. -
November 12, 2020
Helping the economy after the COVID‑19 pandemic
The pandemic won’t last forever. Senior Deputy Governor Carolyn A. Wilkins talks about what the economy will need once we’re past the COVID-19 crisis.