Burkhard Balz: The involvement of big techs in payment systems – are there reasons for central banks to worry?

Speech by Mr Burkhard Balz, Member of the Executive Board of the Deutsche Bundesbank, at the Central Bank Payments Conference, virtual, 29 November 2021.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Ladies and gentlemen,

Thanks to digitalisation, I am able to give a speech at a conference without being there in person. Digitalisation has delivered huge benefits for most people around the world. Ideas and words, pictures and services can flow freely across borders within milliseconds. It enables fresh processes to emerge, involves new players, and changes user habits with far-reaching consequences for our daily lives. Digitalisation supports economic progress overall.

And in payments, it has the potential to increase financial inclusion with a positive impact on the lives of many.

In India, for example, current account ownership rose from 10% to 80% between 2008 and 2017 due to the introduction of Aadhaar, a public digital ID infrastructure. In Bangladesh, a payroll digitalisation programme introduced by clothing factories has helped boost access to financial accounts from 20% to 98% of workers. On 25 October, Nigeria launched a central bank digital currency, the eNaira. This initiative aims to modernise Nigeria's payment systems, reduce the cost of payments, including remittances, and promote financial inclusion.