For the time being, however, I along with other policymakers at the Federal Reserve have concluded that any decision to reserve the nascent market for smart cards and other forms of electronic money as a province for banks alone might well stifle both competition and technological innovation in this area.
Thus, while most would agree that providing efficient payment media for small dollar transactions is a “special” function that banks currently perform, it does not follow that only banks should be allowed to perform the function.