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The Reserve Bank of Australia is conducting a review of retail payments regulation and will consider reducing the cost of electronic payments for both merchants and consumers given the current COVID-19 related reluctance to use cash. ATM withdrawals were down by 30% from March to April and down by more than 40% from a year earlier. However merchants have been hit by higher charges when debut card payments are automatically routed through certain international payment schemes. https://www.rba.gov.au/speeches/2020/sp-ag-2020-06-03.html

G+D Filia is intermittently offline. Payments are instantly settled offline, with occasional online reconciliation. But most importantly: funds received offline can be spent offline (consecutive offline payments). Our token format is the same online and offline, therefore the payment protocols are similar across different kinds of wallet (e.g., online wallets hosted at banks and hardware wallets). No conversion between online or offline ledger is needed. Tokens in hardware wallets are stored in tamper-resistant Secure Elements. Each wallet is equipped with a certificate, ensuring end-to-end encryption for every payment transaction. As an additional safety net, wallets keep a record of offline operations to detect counterfeiting.

The European Central Bank (ECB) will be running a digital euro prototyping exercise to allow market participants to develop front-end prototypes that can be integrated with the back-end infrastructure developed by the Eurosystem. The documents were provided to the five companies that were selected to carry out the experimental work (CaixaBank (peer-to-peer online payments), Worldline (peer-to-peer offline payments), EPI (point of sale payments initiated by the payer), Nexi (point of sale payments initiated by the payee), and Amazon (e-commerce payments)). The material published provides the information needed by any market participant to develop front-end prototypes compatible with the Eurosystem's back-end infrastructure, without restricting participants' potential to innovate. The prototyping exercise is expected to be completed in the first quarter of 2023.

A paper by European Central Bank (ECB) staff studies how the choice of payment instruments affects privacy and welfare in the digital economy. Cash allows merchants to preserve their anonymity but cannot be used for online transactions that generate higher sales from more efficient distribution. By contrast, bank deposits can be used online but do not preserve anonymity: the merchant's bank learns from payment flows and exploits the underlying information to extract rents. Payment tokens issued by digital platforms allow merchants to hide from the bank but also enable platforms to stifle competition (e.g. by limiting the entry of more efficient competitors by creating a walled garden). An independent digital payment instrument that allows agents to share their payment data with selected parties-a privacy-enhancing CBDC-can overcome all frictions and achieves the efficient allocation.

The European Central Bank (ECB) will collaborate with five companies to develop potential user interfaces for the digital euro. The aim of this prototyping exercise is to test how well the technology behind a digital euro integrates with prototypes developed by companies. Simulated transactions will be initiated using the front-end prototypes developed by the five companies and processed through the Eurosystem's interface and back-end infrastructure. The selected companies will each focus on one specific use case of a digital euro; peer-to-peer online payments (CaixaBank), peer-to-peer offline payments (Worldline), point of sale payments initiated by the payer (EPI), point of sale payments initiated by the payee (Nexi) and e-commerce payments (Amazon).

The IMF published a Fintech Note on key findings from the Sub-Saharan Africa CBDC and Digital Payments Survey, shedding light on the motivations, benefits, and challenges of CBDC adoption, as well as the developments of digital private money and crypto assets in sub-Saharan Africa. More than 75% of the 33 central banks surveyed are engaged in-or are planning to engage in-CBDC research or pilot activities. Of these, roughly two-thirds are in the research phase, and slightly over one-third are planning to conclude their CBDC pilot programs within the next two years. More than a quarter are actively preparing to launch a CBDC by 2028, although legal challenges pose major hurdles to getting to that point. Financial inclusion, efficiency in domestic payments and facilitating remittances are the most dominant motivations for CBDC adoption. Fast payment systems and e-Money (such as mobile money) are considered as quick wins in sub-Saharan Africa, and about two-thirds of countries are in the process of implementing or considering fast payment systems that are mostly accessible through mobile phones or the internet.

WeChat will reportedly join AliPay in supporting the People's Bank of China e-CNY pilot. Payments can be made through WeChat Pay by scanning a QR code once an account on Tencent's digital bank WeBank is opened. WeChat has added a "digital yuan" option on its WeChat Pay page and a "payment with e-yuan" option on the "receipt and payment" page. Teaming up with WeChat means there are potentially more than 1 billion users who could use the digital currency.

Before the pandemic started, payment volumes reached new heights, which are predicted to continue but at a pace reflecting both the increased reliance on non-cash transactions and the effect of a dampened global economy. Global non-cash transactions surged nearly 14% from 2018-2019 to reach 708.5 billion transactions, the highest growth rate recorded in the past decade. Asia-Pacific surpassed Europe and North America to become the 2019 non-cash transactions volume leader at 243.6 billion. The increase was driven by increasing smartphone usage, booming e-commerce, digital wallet adoption and mobile/QR-code payments innovations, led by China, India and other SE Asian markets (31.1% growth).

Visa published a technical paper that outlines an approach for offline point-to-point payments between two devices. The protocol allows digital money to be directly downloaded onto a personal device, such as a smartphone or tablet. The money is stored on a secure hardware embedded in that device and managed by a wallet provider (e.g. a bank). CBDC can be transacted from one device to another device directly without any intermediaries such as banks, payment networks, or payment processors. Examples of the underlying technology that can support point-to-point payments include Bluetooth and Near Field Communication (NFC).

"Big banks have also been using their muscle to delay the delivery of Payments Canada's new real-time payment system. Meanwhile, they've been upgrading their own real-time payment product-Interac e-transfer-so that it will be better than Payments Canada's when it finally launches."

The Hong Kong Monetary Authority (HKMA) today announced the commencement of the e-HKD central bank digital currency (CBDC) pilot programme. A total of 16 firms from the financial, payment and technology sectors have been selected to participate in the first round of pilots. The pilots will take deep dives into potential use cases in six categories, including full-fledged payments, programmable payments, offline payments, tokenised deposits, settlement of Web3 transactions and settlement of tokenised assets. https://www.hkma.gov.hk/media/eng/doc/key-information/press-release/2023/20230518e4a1.pdf

Digital payments allow people to access goods and services while in quarantine or social distancing. SARS epidemic in 2003 expedited China's path in launching digital payments and e-commerce in the country. A robust identification system, widespread, consistent internet access and trustworthy ways to get money into digital formats could be important for digital payments to thrive.

This article argues that it is important to distinguish between programmable money and programmable payments because they have different use cases. The example of the e-car is a good use case for a programmable payment. However, the programmability of money is not necessary in this case. Instead, programmable money can be used, for instance, to implement targeted aid payments during crises such as COVID-19. By giving the money paid out to citizens an inherent logic, the government could ensure that the subsidies are spent in a timely fashion and only for predefined things such as food, medicine, or clothes.

China's central bank digital currency (CBDC) project has reached the roughly 100 billion yuan ($14 billion) transaction mark during its pilot phase. "Multiple e-government service platforms have opened digital renminbi payment services, supporting online and offline channels to handle various public utility payments, using digital renminbi to issue tax rebate funds, special funds for monthly medical insurance payment, funds for helping people in need, and 'specialized, special and new' enterprise support funds, etc." Going forward, the People's Bank of China (PBOC) plans to launch the cross-border payments between Hong Kong and mainland China, following the principle of "anonymity for small amounts and traceability of large amounts" to protect the user's personal data.

The Digital Currency Institute of the People's Bank of China (PBOC) and the Hong Kong Monetary Authority (HKMA) are carrying out the second phase of technical testing on the use of digital yuan in cross-border payments, involving more banks in Hong Kong and the use of the Fast Payment System to top up digital yuan wallets. Earlier in November 2023, the Octopus Cards Limited (OCL) e-payment platform and the Bank of China in Hong Kong started to explore new digital yuan application scenarios, with a view to benefitting both mainland visitors to Hong Kong and Hong Kong residents visiting the mainland.

The current draft of the digital euro legislation calls for increased privacy for close-proximity offline payments, which is seen as consistent with the European Union AML/CFT framework risk-based approach. The European Data Protection Board (EDPB) and European Data Protection Supervisor (EDPS) suggest increased privacy for low-value online payments too, but not as private as offline transactions, because online transactions would not be limited to proximity payments, resulting in a potentially attractive model for criminals. Hence, they recommend transaction size limits above which complete checks can occur that are lower for online than offline transactions. However, Atakan Kavuklu suggests equalizing the limits at the higher level for all low-value proximity payments (e.g., those using NFC and Bluetooth connections). He believes this could benefit the acceptance and success of a digital euro.

Xie Ping, a former People's Bank of China (PBOC) research director, made critical public comments about China's central bank digital currency (CBDC) at a recent university conference. After launching in 2020, e-CNY transactions hit $88 billion yuan ($12 billion) at the end of 2021, after which growth slowed down significantly, only crossing the $100 billion yuan threshold at the end of August 2022. Ping said existing digital retail payment platforms such as AliPay and WeChat Pay "have formed a payment market structure that have met needs for daily consumption". Hence,  the e-CNY use case needs to expand from its current use as a cash substitute and opened to other uses such as the ability to pay for financial products or connected to more payment platforms to boost adoption. https://finance.caixin.com/2022-12-28/101982996.html

The National Bank of Ukraine (NBU) surveyed 100 financial market experts to determine the market niche and potential use cases for an NBU-issued central bank digital currency. Most respondents believe retail cashless payments and cross-border payments and settlements to be the most promising use cases for e-hryvnia. Second came G2P welfare payments, featuring smart contract technology to restrict the CBDC's use to specific purposes or during a special period of time. There was also considerable interest in the potential of e-hryvnia as an instrument for virtual assets settlements.

Libra is actually a revamped version of a much older payments model. In 1996, Douglas Jackson, an oncologist and fan of the gold standard, founded a payments system called e-gold. Backed one-to-one by reserves of the yellow metal, the e-gold system allowed users all around the world to make instant private electronic payments. Unfortunately, e-gold ran into problems with regulators...

The new Peoples Bank of China (PBOC) e-CNY app has scored a 4.4 out of 5 in China's Apple App Store, and Richard Turrin, in his review, concurs. If the e-CNY is going to be accepted it's got to bring something to the table in addition to what's offered by Alipay and WeChat Pay, and Richard runs through the major new features that will be important enough that they'll get some to change. These include: -Unlimited spending limits for e-CNY wallets that fulfill the highest level of know-your-customer (KYC), versus Alipay personal accounts that top out around RMB 20,000 (about $3,000). -The ability to set spending limits not just on the entire account but on all of the sub-wallets, a money management feature that the other payment platforms don't have. -Payments of less than RMB 2000 ($300) are anonymous! There is no equivalent for the other payment platforms or even western credit cards.