The Deputy Governor of the Central Bank said that today amid a rapidly shifting frontier, the country needs to both catch up and keep up with the innovation in payments.
Deputy Governor Madouros Vasileios made his comments at Banking and Payments Federation Ireland’s National Payments Conference in Dublin today.
Madouros Vasileios said there has been a rapid shift from cash to electronic payments.
“Internationally, paying by account has evolved into an increasingly effective payment method, as it offers a convenient alternative to cards, strengthening competition, lowering costs for merchants and consumers and improving system-wide resilience,” he said.
But he added that Ireland continues to lag behind other jurisdictions in terms of availability and offerings.
The Central Bank has prioritised the development of the National Payment Strategy and has made progress over the past year.
“But it is also clear that there is substantial further work ahead of us to make pay-by-account functionality broadly available in Ireland – this must be an important near-term priority for both the Central Bank of Ireland and industry,” the Central Bank Deputy Governor said.
He said it is very clear that central banks and regulators cannot afford to stand still on the issue of payments.
“The role of central banks and regulators in the payments system is to ensure trust,” he stated.
“Ultimately, we ourselves are on a journey, as we are deepening our understanding of the opportunities and risks of different technologies and innovations while protecting access and choice for those who prefer or depend on cash as a means of payment,” he said.
“Our ultimate aim is to ensure that the benefits of innovation for consumers of financial services are realised and the risks and transitions are managed effectively,” he said.
He said the Central Bank is exploring the use of new technologies for settlement in central bank money, while it is also in preparation phase for a Digital Euro.
“Our approach to regulation and supervision has been responsive to the evolution of the payments ecosystem; and, of course, we remain committed to cash as a critical part of the payments ecosystem,” he added.
Vasileios Madouros said that digitalisation is one of the most powerful “mega-trends” shaping society and the economy – payments are the lifeblood of the economy.
“Innovation in payments – done well and safely can unlock broader economic benefits. It can improve efficiency, enhance competition, and reduce costs for businesses and households,” he said.
“It can also reduce fragmentation, helping to maximise the benefits of the Single Market for all Europeans,” he added.
