According to the Bank of International Settlements (BIS), some central bank-operated wholesale payment systems are at the end of their technological life cycles, making the current system subject to errors. Thus the rationale for the wholesale CBDC could be to enhance payments and securities settlement efficiency, as well as to reduce counterparty credit and liquidity risks.
In terms of the retail CBDCs, different motivating factors are in play. Clearly, we live in an age characterized by the rise of electronic payment methods. Although these are often more convenient and efficient than paper banknotes, such digital payment solutions are based on commercial bank money. The amount of cash in circulation is declining in some countries.