For many years, observers have looked forward to the advent of electronic money, a system that uses either a computer chip or another electronic device to record payments and debits automatically. There are obvious efficiency advantages in terms of ease of handling and record-keeping for consumers, merchants, the banking system and the Federal Reserve.
Use of electronic money systems appears to be growing in at least a few foreign countries. But in this country, growth of electronic money systems is sluggish – well behind earlier predictions, well behind the growth of credit and debit card use and way behind the growth of other types of electronic commerce.