But, just to be sure we have covered all the possibilities, let’s assume that banks or other providers of e-money choose to hold settlement balances to meet liquidity needs in the form of interbank deposits-deposits with other banks--instead of balances at the central bank.
In this case, perhaps the large money center and regional banks would collectively take on the role of providing settlement balances to the providers of e-money. Let’s call them the settlement banks. Let us also assume that such settlement balances were convertible into balances held at the central bank, a link that would enhance the acceptability of and confidence in e-money.