On the other hand, there are some constraining factors that hamper digitalization in South East Europe, including Macedonia, such as: the negative effects that the financial crisis had on the ability of banks to innovate, and the local mentality of the population which still does not show a sufficient level of confidence in online activities. Financial services industry in Macedonia is in essence still traditional, conservative industry, but is evolving. Banks strive to keep pace and fit in the new digital era by investing more and more funds in new products and financial innovations, as well as sponsoring software development conferences and new technologies. This is supported by relatively solid infrastructure for digitization in Macedonia which is readily available at satisfactory level. For example, 76% of households in Macedonia had access to internet in 2017 vis-à-vis 85% in the EU. On average, bank deponents have two payment accounts in Macedonia. However, only 7% of payment accounts held by the households can be used for electronic payments, while this share is relatively higher in case of legal entities (29%). The latter initiated 51% of the credit transfer in an electronic way, while the households initiated electronically only 20% of their credit transfers in 2017. The companies usually initiate their payments by using computers, while households rely mainly on computers (92% of electronic credit transfers), mobile phones (7% of electronic credit transfers) and ATM (1% of electronic credit transfers).
First, the Bank of Thailand will ensure ample liquidity in the system in order to accommodate the economic recovery. As policy normalization by the Fed is imminent, the risk of liquidity withdrawal from Emerging Markets increases. We anticipate limited impact on the overall Thai economy as markets have priced in the Fed’s initial hike. Besides, it is widely expected that the Fed fund rates would rise gradually from then on. As for now, despite the slow economic growth in Thailand, the overall credit to the private sector continues to expand at around 5 per cent. Furthermore, enterprises have issued a sizable amount of corporate bonds, leveraging on lower yields compared to last year. Commercial banks’ liquidity position is stable. All these are indications of favorable domestic financing conditions. Should a sudden reversal scenario occurs, the Bank of Thailand would make sure that liquidity will not become an impediment to economic recovery. The Bank of Thailand will also ensure that “cost of funds” is accommodative to the ongoing recovery. The two pre-emptive cuts in the policy interest rate earlier this year, in response to greater downside risks to growth, have eased domestic cost of funds. In addition, low inflationary pressure gives room for monetary policy to remain accommodative. This would ensure that the overall monetary conditions are conducive to the economic recovery. Nevertheless, we keep a cautious eye on risks to financial stability, especially under the prolonged low interest rate environment. Household debt, although it has stabilized, remains high in relation to GDP.