Private commercial banks issue predominantly digital money in the form of electronic transfers between bank deposit accounts[3]. Page 4  We have seen major changes in recent years in the form of use of money to make payments. In the mid-1960s, most workers were paid weekly in cash, and around 70% of the population did not have a bank account. [4] Very few had access to credit or debit cards. Consequently, for every £ of funds that people held to make payments, over a third would be held as cash. Nowadays, less than 5% is held as cash. Even 15 years ago, 60% of transactions in the UK used physical cash; pretty much everyone in this room would have carried enough for everyday transactions. In 2021 only 15% of transactions involved physical money. Technology and the increasing digitalisation of everyday life has transformed the way we use money. Private commercial bank money accounted for 85% of the payments made by the public. Within that, debit and credit card transactions accounted for 69% of transactions. Contactless payment has made such transactions much easier for everyday life. And the growth of internet commerce has required the use of digital money. It is always challenging to forecast how technological advances and social trends will play out. Few at the turn of this century would have predicted the development and growth of a massive and dominant market and social platforms.
Against the background that I have portrayed in my previous comments, it is clear that central banks have a genuine interest in improving their understanding of how the objectives of financial integration and financial stability, or even macroeconomic stability, interact with each other. I already mentioned that this is an area which is under-researched. Two years ago, the Network on Capital Markets and Financial Integration in Europe identified this gap and decided to include the relationship between financial integration and financial stability in a list of the network’s priority areas, posing a series of stimulating questions aimed at providing some guidance for researchers’ efforts. I think it is useful to recall the five questions posed by the Network: -  First, how can financial regulations be designed so as to be conducive to integration while still ensuring financial stability? -  Secondly, what are the main links between financial integration and contagion? -  Thirdly, what are the mechanisms that can trigger contagion and financial fragility? BIS Review 118/2006  3  -  Fourth, how does competition in the financial services industry affect the ability of the financial system to withstand shocks? -  And finally, how and to what extent do financial crises affect economic activity? As you will have realised, there is an almost perfect correlation between these questions and the main topics of the different papers that make up the excellent and well-balanced programme that the organisers have put together for this Conference.