The IRMA Community
Newsletters
Research IRM
Click a keyword to search titles using our InfoSci-OnDemand powered search:
|
Central Bank Digital Currency and Financial Stability in a Dual Banking System
|
Author(s): Hichem Hamza (Islamic Economics Institute, King Abdulaziz University, Saudi Arabia)and Khoutem Ben Jedidia (Higher Institute of Accountancy and Business Administration, University of Manouba, Tunisia & Islamic Economics and Finance Research Unit, University of Ez-zitouna, Tunisia)
Copyright: 2020
Pages: 20
Source title:
Impact of Financial Technology (FinTech) on Islamic Finance and Financial Stability
Source Author(s)/Editor(s): Nader Naifar (Imam Mohammad Ibn Saud Islamic University, Saudi Arabia & University of Sfax, Tunisia)
DOI: 10.4018/978-1-7998-0039-2.ch012
Purchase
|
Abstract
The digitization of payment and the development of private digital currencies have constrained central banks to examine the issuance of their own central bank digital currency (CBDC) in order to face the competition of the new peer-to-peer payment system and the decline of cash use. This chapter addresses the topic of CBDC and places the discussion within the context of dual banking intermediation and financial stability. The design of CBDC in term of accessibility, anonymity, interest rate, and payment mechanism depends on the cryptocurrency use and money characteristics regarding the use of cash and deposit. The CBDC Sharia compliant, free of interest or PLS-based, fulfilling money value stability might be a solution. The effects of CBDC on banking intermediation and financial stability depend importantly on the CBDC design and switch significance of banks deposit to CBDC but remain an open question given the pros and cons arguments. In a dual banking system, Islamic banks could limit the disintermediation effect and maintain financial stability under Sharia compliance.
Related Content
V. V. Devi Prasad Kotni, Sujit Kumar Patra, Sunil Kumar.
© 2024.
21 pages.
|
Adekunle Alexander Balogun, Gbenga Olorunmade.
© 2024.
15 pages.
|
Ashwani Sharma, Nitpal Singh Rathod.
© 2024.
15 pages.
|
Peterson K. Ozili.
© 2024.
11 pages.
|
Yusuf Olatunji Oyedeko, Adesola Trust Gbadebo.
© 2024.
15 pages.
|
Oladapo Fepetu, Pelumi Abdulmalik Adewumi.
© 2024.
21 pages.
|
Rifkatu Nghargbu.
© 2024.
16 pages.
|
|
|