What impact does electronic money have on traditional commercial banks?

What opportunities and challenges have the emergence and use of electronic money brought to the monetary management of banks?

In the era of economic globalization, with the development of information technology, great changes have taken place in people's production and lifestyle, which further promoted the development of monetary forms. As a new currency form, electronic money has become an indispensable part of today's economy with its advantages of convenience, rapidity and accuracy, and its importance is gradually strengthening. At the same time, the development of electronic money has also brought many opportunities and challenges to the monetary management of banks.

Opportunities:

1, reducing the deposit reserve turned over and the excess reserve of commercial banks.

First of all, the central bank has not yet assessed the deposit reserve of electronic money. Electronic money issued by financial institutions has fulfilled the basic functions of money of currency exchange medium and played the role of replacing deposits and cash, but it is outside the financial system and has not paid the deposit reserve. Secondly, according to the liquidity of the currency, the central bank determines the deposit reserve ratio in different proportions. The stronger the liquidity, the higher the deposit reserve ratio. Because of the fast conversion speed of electronic money, it can be classified as demand deposit or time deposit, which enables commercial banks to pay less deposit reserve, and ultimately reduces the efficiency of the statutory deposit reserve ratio. Thirdly, due to the short conversion time and low cost of electronic money assets with different term structures, it is not necessary for commercial banks to hold higher excess deposit reserve of the central bank, thus reducing the sources of deposit reserve of the central bank. On the other hand, the unique and convenient payment and settlement means of electronic money reduce the economic transaction cost, and the interest income obtained in the form of demand or even time deposit is the opportunity cost of cash assets.

2. The widespread use of electronic money has greatly reduced the operating costs of banks, accelerated the circulation speed of money and improved the service efficiency of banks.

For banks, banknotes and coins usually need a lot of money for counting, bookkeeping, storage, transportation and security, but the rapid development of electronic money can greatly simplify these tasks and save the high cost of handling coins and banknotes. With the help of computer information technology, electronic money plays the role of transaction, circulation and payment with electronic information flow, which will inevitably reduce transaction costs and improve the circulation and transaction speed of money market and commodity market.

3. This bank facilitates the transfer and allocation between different branches.

4. It is beneficial to the development of bank card issuing business.

The transformation of national economic development mode will mainly stimulate domestic demand, and the development of bank credit card industry is facing a golden opportunity.

5. Encourage banks to actively develop new tools and carry out business innovation.

In addition to the original banking business, commercial banks have also developed new businesses, such as handling over-the-counter deposits and withdrawals, opening personal financial accounts such as consumer accounts, investment accounts and foreign exchange trading accounts, handling personal consumption credit, education investment credit and portfolio tools, actively contacting large shopping malls, supermarkets and other units that often use electronic money, and setting up POS machines in the above units to connect banks, units, governments and individuals.

6. Change in bank marketing.

The emergence of electronic money has made financial enterprises and non-financial enterprises such as commercial banks have an important impact on the total circulation scale of electronic money, thus the functions of commercial banks have undergone major changes. Commercial banks will compete fiercely for market share in the field of online electronic money payment and settlement, prompting banks to establish customer-oriented main marketing methods and strive to occupy more customer groups.

Challenge:

1. The annual consumption of electronic money in China has been on the rise since 2003, and the benefits brought by electronic money consumption to its issuers have also been greatly improved. Commercial banks will lose their share of electronic money business income if they don't strive for more electronic money issuance qualifications or stay at the current level of electronic money business services.

2. If a commercial bank issues electronic money, when users initially buy electronic money, their traditional currency deposits will decrease, electronic currency deposits will increase, and social traditional currency deposits will also decrease. If the central bank does not set aside deposit reserve for electronic money deposits in commercial banks, the total amount of electronic money deposits in society will continue to increase as users use electronic money for payment activities; Accordingly, the process of creating deposits in traditional currency will stop, so that the total amount of deposits in traditional currency of commercial banks will be reduced, thus reducing the amount of deposit reserves.