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There are a lot of disruptions to the banking system already as a result of COVID-19.The COVID-19 pandemic is also affecting the development of central bank digital currencies (“CBDCs”). The Bank of International Settlements has said that the COVID-19 pandemic may accelerate the development of CBDCs in part by changing consumer views on cash. Recently, China, a leader in CBDC research, announced that it will continue to press forward with its development of a digital renminbi.

I will say yes because there is a growing concern that a shift away from cash payment so as to curb the spread of coronavirus will leave a gap in the payment landscape that may be quickly filled by the likes of CBDCs, Perhaps COVID-19 may serve as the latest crisis to serve as a catalyst for the next transition to CBDC. Notably, it has come at a time in which both central banks and policymakers are becoming increasingly positive about the potential benefits of CBDCs in retail forms.

In the last issue of CPN was deliberated on the likely developments this pandemic will cause to the payments industry, such as the concerns over safety of cash handling, a rapid shift towards digital consumer payments and the acceleration of the Central Bank Digital Currency (CBDC) efforts. A month later, some clear patterns are emerging that will have long lasting consequences for us all and have the potential to change the world of payments forever. Key takeaways • The Covid-19 pandemic has fanned public concerns that the coronavirus could be transmitted by cash. • Scientific evidence suggests that the probability of transmission via banknotes is low when compared with other frequently-touched objects, such as credit card terminals or PIN pads. • To bolster trust in cash, central banks are actively communicating, urging continued acceptance of cash and, in some instances, sterilising or quarantining banknotes. Some encourage contactless payments. • Looking ahead, developments could speed up the shift toward digital payments. This could open a divide in access to payments instruments, which could negatively impact unbanked and older consumers. The pandemic may amplify calls to defend the role of cash – but also calls for central bank digital currencies. Central banks play a pivotal role in maintaining the safety and integrity of the payment system. They provide the solid foundation by acting as guardians of the stability of money and payments. The pandemic and resulting strain on economic activity around the world have confirmed the importance of central banks in payments. • Digital innovation is radically reshaping the provision of payment services. Central banks are embracing this innovation. They promote interoperability, support competition and innovation, and operate public infrastructures - all essential for easily accessible, low-cost and high-quality payment services. Central banks, as critical as ever in the digital era, can themselves innovate. In particular, central bank digital currencies (CBDCs) can foster competition among private sector intermediaries, set high standards for safety and risk management, and serve as a basis for sound innovation in payments.

the COVID-19 pandemic has incurred far-reaching changes in retail payments, revealing both the strengths and weaknesses of existing systems. First, points to the sharp decline in cash payments due to merchant and consumer concerns over viral transmission. Economic uncertainty has also triggered “precautionary holdings” of cash, leading to a decline in daily cash transactions.  In parallel, restriction measures imposed by national governments, such as the closure of physical stores, has led to a surge in e-commerce payments. Decreased mobility has triggered a decline in cross-border visa transactions as well as a steep drop in migrants’ remittances. All these changes reveal both the advantages and the drawbacks of existing payments systems. On the one hand, digital payments have enabled many economic activities to continue despite major disruptions to daily life.  On the other, existing inequalities between social groups have become starker during the crisis, in part due to uneven levels of financial inclusion, which can adversely affect individuals’ access to government relief The issuance of CBDCs is “at the frontier of policy opportunities” for central banks and “could amount to greater changes.”

I firmly affirm the resolution with the following points of mine. The Coronavirus pandemic has prompted retailers to ask customers to wear masks, maintain physical distancing and avoid the use of cash when possible. Despite scientific evidence indicating that currency doesn't transmit Covid-19, there continue to be an unprecedented weariness around the use of cash altogether. For example, * In the UK this has led to mass conversation of small businesses to cashless only payments. * At the peak of the global pandemic, banks in China and South Korea began disinfecting and quarantining bank notes to slow the spread of the novel Coronavirus. Although other Central Banks have refused to adopt such measures communicating that risks posed by handling cash are low compared to other objects that are frequently touched such as pin pads. But despite such assurance fear of transmitting the virus could accelerate the trend of digital payment including CBDCs and reducing the use of cash in the society * The Bank for international settlement which advices central banks around the world, released a bulletin in April that said the pandemic could speed up the shift towards digital payment around the world including CBDCs. That's not a surprise. A global crisis can often act as a catalyst for structural change. For instance, the 2009 vastberga heist led to a cashless society in Sweden. As a string of robberies occurred in shops, banks and even buses, Sweden moved to reduce cash circulation as a way to protect workers. Cash use in Sweden has since been on the decline from 39 per cent in 2010 to 13 per cent in 2018. Currently about 20 per cent of retailers in the country no longer accept cash * The development of CBDCs in this way might even be seen as the natural next evolutionary step in the development of money. From barter to precious metals, to base metal coinage, to bank notes, each iteration of national Currencies has been propelled by a crisis, be it war, economic depression or speculative bubble. Perhaps Covid-19 will serve as the latest crisis to serve as a catalyst for the next transition to national digital Currencies * The pandemic may have put calls for CBDCs into sharper focus highlighting the value of having access to divers means of payment and the need for any means of payment to be resilient against a broad range of threats. * In the US there is a renewed discussion over the issuance of a digital dollar, a draft provision for which was included as part of an emergency Coronavirus-induced stimulus bill as a means to make payment to people and business affected by the crisis. * Opportunity: this world pandemic could present an opportunity for government to support the recovery through infrastructure investment, supporting a green digital and more sustainable economy. * The Bank of Canada encouraged retailers to stop refusing cash because it could disproportionately affect those who are dependent on cash as a means of payment. Despite such assurance, fear of transmitting the virus could accelerate the development of CBDCs and reduce the use of cash in society. * There seems to be some leeway with the introducing change during a crisis, as the experiment in China and Sweden display. But the introduction of a digital currency during a crisis could provide government with frightening new powers. The role of the state could drastically change as nations shift towards a cashless society, which encourages central banks to adapt in order to maintain firm control over money supply. * The coronavirus pandemic has led to unprecedented public concerns about viral transmission via cash. Central Banks report a large increase in queries from the media on the safety of using cash. The number of internet searches partaining to both "cash" and "virus" is at record high. While search interest in these terms also rose in several East Asian and European countries during the 2009-20H1N1 pandemic, those statistics are dwarfed by the extent of recent searches. suddenly cash has become a health concern in its own right, adding to the risk of transmitting virus within communities Irrespective of whether concerns are justified or not perceptions that cash could spread pathogens may change payment behaviour by users and firms.

Yes. I think the development of CBDC will be accelerated by the impact of the coronavirus because thee global pandemic that is COVID-19 has produced a range of unexpected consequences in terms of demand and supply. However, before the pandemic, few would have predicted a dramatic fall in the demand for cash. Historically, in times of uncertainty, people are more inclined to hoard cash, triggering runs on the banks and a reversion to a cash economy. COVID-19 has had the opposite effect. Admittedly, the use of cash was already in decline in the developed world, with credit cards and electronic transfers far exceeding the use of bank notes and coin that moved around the system. In developing countries too, the growth of mobile payments and remittances being transferred back home electronically from many countries’ diasporas had reduced the hegemony of cash. Even so, the Coronavirus has radically changed the perception of cash. Suddenly, cash has become a health concern in its own right, adding to the risk of transmitting the virus within communities. So with this government of the world will be more concerned with the implementation of CBDC to curb the spread of the virus.

I would say yes. Owing to the fact that there's a decline in cash payments due to concerns over viral transmission. As believed by health experts, the use of cash results to the increase in the coronavirus pandemic as viruses may be transmitted from person to person through bank notes. As an infected person makes payment with cash, the receiver may get infected through it. To this effect, the development of CBDC will be hasten inorder to restrict the spread of the virus. The implementation of CBDC will soon be a reality

Notably, the Corona virus has come at a time in which both central banks and policy makers are increasingly positive about the potential benefits of CBDCs, in both their wholesale and retail forms. The Bank for International Settlements (BIS) expect the COVID-19 crisis impact on retail payments to have a knock on effect on the development of CBDCs.The crisis has amplified the calls for greater access to digital payment by vulnerable groups and for more inclusive, lower-cost payment services going forward. CBDC issuance is not so much a reaction to cryptocurrencies and private sector stablecoin proposals, but rather a focused technological effort by Central Banks to pursue several public policy objectives all at once. Therefore, a successful CBDC could offer a new, safe, trusted and widely accessible means of payment. In this context, the issuance of CBDCs is at the frontier for central banks and could amount to a sea of change in the method of payment worldwide.

This isn't the first time that a major pandemic would wreck fatal havoc on the globe without changing money order. It is not just simple to accept that Covid-19 as a single factor would suffice to fast track development of CBDC as a safe haven to viral transmission rumoured around cash payments. This is no news anymore that CBDCs have been in the works for many years in some countries, as there are many other benefits in the eyes of the lawmakers that speak in favour of introducing them. In fact, digital Yuan like some other sovereign coins has been in the development since 2015 with few details being known until its completion. What can accelerate a strong currency development apart from economic cum political interests are; ready social acceptability, functional infrastructure and workable policy framework, lower cost of implementation and World Bank endorsement among others. On a contrary note, the acceleration of the fast development of CBDCs has been stalled in many countries which could not reconcile its purpose with problems of security, centralization of data and access and privacy which are germane to those who faulted it! Therefore, accelerated development of CBDC would only come to full force when the world leaders move for its support and not as a duress call of plague.

Coronavirus has proved a point in support of modernising government-to-person (G2P)/payments and retail payments scalability to urgent CBDC adoption. As Covid-19 unfolds, many governments are considering direct financial transfers to households and small businesses beyond traditional social protection mechanisms while the economies and citizens are under lockdown orders. Pathetic as it may sound, in many developing countries the scale of there payments is unprecedented by lack of infrastructure as people who could not get target social relief resort to forbidden business dealings that expose them to contaminated cash that hypes new headlines as casualty increases. Some authorities have now resolved that the vulnerability of cash currency to the plaque should be corrected by the speedy effort to put CBDCs in place to stop future recurrence. This they arrive at after fiats inconveniences expose a lot of shortcomings and lapses that only sovereign currency coins can take care of.