All major Swedish banks, clearing organisations, the Swedish National Debt Office and the Riksbank are participants in the Riksbank’s RIX system where weekly turnover corresponds to a little less than Sweden’s GDP. In practice, this means that participants have accounts in the Riksbank’s system in which they regulate debts to each other via transfers between their RIX accounts. A bank's balance in its RIX account forms a risk-free claim on the Riksbank. At some point during the day, the money thus ends up on the Riksbank's balance sheet, which is the meaning of the term ‘central bank money’, as I explained previously. The system has been constructed to manage major payments between the dominant players in the market in a secure manner. Private persons’ payments are lumped together into larger amounts before they pass through the system. It has been optimised to manage a smaller amount of payments of larger amounts with a very high level of security. The mean value of a payment sent through the system is about 35 million kronor. 19 The Riksbank also has regular contact with all participants, who also participate in training sessions, crisis exercises and so on. As the Riksbank and the banks must have personnel on site, opening hours are currently restricted to normal office hours. It is conceivable that the banks would have their own system to regulate payments with each other. But this would increase the counterparty risks in the financial system.
Many other central banks, including the Bank of England and Bank of Canada, have ongoing analysis projects on digital central bank money. 31 Considering how rapidly developments are proceeding, it is probably good to be aware that it will require both resources and cooperation with external players, both authorities and companies, for the Riksbank to act proactively in this matter. The Riksbank will modernise the supply of settlement services I have given several reasons for why the private market cannot be expected to provide a secure and efficient payment system without government interference: economies of scale and network effects lead to concentration in a monopoly system that becomes vulnerable and results in a lack of competition and innovation. At the same time, positive network effects suggest that cooperation and standardisation may be effective solutions. In Sweden, we have a long tradition of cooperation between the banks in the area of payment which has been very positive for Swedish consumers. Bankgirot, Bankomat (ATMs), Bank ID and Swish are a few examples. The Riksbank and other central banks have traditionally provided systems and central bank money to allow financial institutions to be able to regulate their mutual debts in a secure manner. The payment market is now in a state of transformation, among other things due to technological progress, not least via solutions for smart phones. In other words, we are on the way to a market in which end users demand that payments be rapid and constantly available.