Fintech and Central Bank Digital Currency in Australia
In Australia, one of the significant pieces of fintech has involved both big and small institutions as well as the Reserve Bank of Australia building some key new infrastructure.
We shed light on Australia’s fast real-time retail payments system, the New Payments Platform (NPP), which was launched in February 2018 by a consortium of 13 financial institutions, including the Reserve Bank of Australia (RBA). The NPP operates on a 24/7 basis and allows financial institutions to provide immediate funds availability to payment recipients, even where payers and payees have accounts with different financial institutions. We highlight that there is no strong case for the RBA to issue a retail central bank digital currency given that the safer Next Generation Banknote series is available and the safer NPP, for which the deposits are projected by the Financial Sector Claims Scheme, is installed.