Still, it is important to remember that this changeover has been a long time in coming. After all, electronic wire transfers have been around for most of our lives and debit cards and the automated clearinghouse (ACH) system were developed three decades ago.
But while liquidity provision helps, it can, at best, ameliorate the impact of counterparty risk. It cannot eliminate it. The second thing that is needed is a restoration of confidence in the key financial institutions. Because the lack of confidence is, ultimately, about solvency, re-capitalisation of the relevant institutions is required.