Banking and Payment System Stability in an Electronic Money World

Indeed, stored-value systems, as well as credit-based and deposit account-based systems, that communicate instructions or transfer value over open communication and computer networks represent new techniques (based on encryption schemes) to initiate payments. These new techniques hold a great deal of promise in that they potentially offer added convenience to the consumer. This promise is qualified by the question of whether these new means of payment add to the perennial risks of instability in the payment system and the banking system.