2019 Cash Alternative Survey Results Staff discussion paper 2020-8 Kim Huynh, Gradon Nicholls, Mitchell Nicholson The role of cash in Canadians’ lives has been evolving, as innovations in digital payments have become more widely adopted over the past decade. We contribute to the Bank of Canada’s research on central bank digital currency by monitoring Canadians’ use of cash and their adoption of digital payment methods. Content Type(s): Staff research, Staff discussion papers JEL Code(s): C, C1, C12, C9, E, E4, O, O5, O51 Research Theme(s): Money and payments, Cash and bank notes, Digital assets and fintech
The Interplay of Financial Education, Financial Literacy, Financial Inclusion and Financial Stability: Any Lessons for the Current Big Tech Era? Staff working paper 2020-32 Nicole Jonker, Anneke Kosse The objective of this paper is twofold. First, we assess whether financial education might be a suitable tool to promote the financial inclusion opportunities that big techs provide. Second, we study how this potential financial inclusion could impact financial stability. Content Type(s): Staff research, Staff working papers JEL Code(s): D, D1, D14, D9, D91, D92, G, G2, G21, G23, O, O1, O16 Research Theme(s): Financial system, Financial stability and systemic risk, Money and payments, Digital assets and fintech
The potential effect of a central bank digital currency on deposit funding in Canada Staff analytical note 2020-15 Alejandro García, Bena Lands, Xuezhi Liu, Joshua Slive A retail central bank digital currency denominated in Canadian dollars could, in theory, create competition for bank deposit funding. Content Type(s): Staff research, Staff analytical notes JEL Code(s): E, E4, E41, E44, E5, G, G1, G10, G17, G2, G21, G3, G32, O Research Theme(s): Financial system, Financial institutions and intermediation, Financial stability and systemic risk, Money and payments, Digital assets and fintech
Cash and COVID-19: The impact of the pandemic on demand for and use of cash Staff discussion paper 2020-6 Heng Chen, Walter Engert, Kim Huynh, Gradon Nicholls, Mitchell Nicholson, Julia Zhu Consumer spending declined significantly during the recent COVID-19 pandemic. This negative shock likely reduced spending across all methods of payment (cash, debit, credit, etc.). The mix of payment methods consumers use could also be affected. We study how the pandemic has influenced the demand for and use of cash. We also offer insights into the use of other payment methods, such as debit and credit cards. Content Type(s): Staff research, Staff discussion papers JEL Code(s): C, C1, C12, C9, E, E4, O, O5, O54 Research Theme(s): Money and payments, Cash and bank notes, Retail payments
Security of a CBDC Staff analytical note 2020-11 Cyrus Minwalla Security is an important element in ensuring public confidence in a central bank digital currency (CBDC). This note highlights the required security properties of a CBDC system and the challenges encountered with existing solutions, should the Bank of Canada choose to issue one. Content Type(s): Staff research, Staff analytical notes JEL Code(s): E, E4, E42, E5, E51, O, O3, O31 Research Theme(s): Money and payments, Digital assets and fintech, Payment and financial market infrastructures
Designing a CBDC for universal access Staff analytical note 2020-10 John Miedema, Cyrus Minwalla, Martine Warren, Dinesh Shah If the Bank of Canada issues a central bank digital currency, the technology should be designed for universal access. Content Type(s): Staff research, Staff analytical notes JEL Code(s): E, E4, E41, O, O3, O31 Research Theme(s): Money and payments, Cash and bank notes, Digital assets and fintech, Payment and financial market infrastructures, Retail payments
Privacy in CBDC technology Staff analytical note 2020-9 Sriram Darbha, Rakesh Arora Privacy is a key aspect of a potential central bank digital currency system. We outline different technical choices to enact various privacy models while complying with the appropriate regulations. We develop a framework to evaluate privacy models and list key risks and trade-offs in privacy design. Content Type(s): Staff research, Staff analytical notes JEL Code(s): E, E4, E42, E5, E51, O, O3 Research Theme(s): Money and payments, Digital assets and fintech, Payment and financial market infrastructures
Technology Approach for a CBDC Staff analytical note 2020-6 Dinesh Shah, Rakesh Arora, Han Du, Sriram Darbha, John Miedema, Cyrus Minwalla In this note, we highlight a range of technical options and considerations in designing a contingent system for a central bank digital currency (CBDC) in Canada and explore how these options achieve stated public policy goals. Content Type(s): Staff research, Staff analytical notes JEL Code(s): E, E4, E42, E5, E51, O, O3, O31 Research Theme(s): Money and payments, Digital assets and fintech, Payment and financial market infrastructures, Retail payments
Technology Adoption in Input-Output Networks Staff working paper 2019-51 Xintong Han, Lei Xu We study how input-output networks affect the speed of technology adoption. In particular, we model the decision to adopt the programming language Python 3 by software packages. Python 3 provides advanced features but is not backward compatible with Python 2, which implies it comes with adoption costs. Content Type(s): Staff research, Staff working papers JEL Code(s): C, C6, C61, L, L2, L23, L8, L86, O, O1, O14, O3, O33 Research Theme(s): Models and tools, Economic models, Structural challenges, Digitalization and productivity
The Cyber Incident Landscape Staff analytical note 2019-32 Nikil Chande, Dennis Yanchus The Canadian financial system is vulnerable to cyber threats. But for many firms, cyber risk is difficult to quantify. We examine public information on past cyber incidents to better understand the current risk landscape and find that a holistic view is needed to fully grasp the nature of this risk. Content Type(s): Staff research, Staff analytical notes JEL Code(s): G, G2, G28, M, M1, M15, O, O3, O33, O38 Research Theme(s): Financial markets and funds management, Market functioning, Financial system, Financial stability and systemic risk