by James F. Dingle
A joint Publication of the Bank of Canada and the Canadian Payments Association
In simple societies, money itself—whatever its physical form—provided the medium of exchange in economic transactions. More recently, payments systems have evolved to provide the medium of exchange, facilitating the numerous transfers of money—now largely recorded as deposit liabilities of financial institutions—from payors to payees. In Canada, as generally in the world, the decades of the 1980s and 1990s saw the medium of exchange move away from paper and increasingly towards electronic form. This was true both for individual consumers, who began using payment cards to make purchases at retail stores, and for corporate treasurers, who increasingly paid for manufacturing inputs or financial investments by using a direct computer link to their financial institutions.
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