E‐cash is more interesting than you think: what are the key issues?

Digital money has made slow progress over the last five years, but now momentum is building and banks throughout Europe have begun to deploy digital money on a large scale: GeldKarte in Germany, Proton in Belgium, CASH in Switzerland, etc. Early trials have been inconclusive, markets remain fragmented and cautious, and consumers remain to be convinced that they can place trust in digital services, but the emergence of the Net has revitalised the digital money scene. Discusses the possible consequences of e‐cash transactions in an international networked environment where long established economic and monetary ideas may no longer be valid. Raises key issues such as the implications of e‐cash on the overall money supply and inflation control, how e‐cash systems fit into fair trading regulations, the impact on the tax base, demand for government issued notes and coins and the protection of commercial and personal privacy. The importance of innovation by industry, co‐operation as the basis for competition and the creation of a regulatory framework by government are highlighted. Warns of the need for regulating authorities to ensure that economically disadvantaged groups are not excluded from the digital money environment.