I would now like to expand on each of these. 1. The shift to electronic payments An appropriate starting point is to recognise that most money is already digital or electronic. Only 3½ per cent of what is known as ‘broad money’ in Australia is in the form of physical currency.
The rest is in the form of deposits, which, most of the time, can be accessed electronically. So the vast majority of what we know today as money is a liability of the private sector, and not the central bank, and is already electronic. With most money available electronically, there has been a substantial shift to electronic forms of payments as well.