Reuters: Analysis: Digital Rivals? Central Bank E-Cash Plans Prompt Lenders to Wade in

Reuters, July 13, 2021, Analysis: Digital Rivals? Central Bank E-Cash Plans Prompt Lenders to Wade in

As central banks dabble with digital currencies, commercial lenders are ramping up efforts to influence policy and technical plans, according to more than half a dozen industry executives and public filings.

Worried that the explosion in cryptocurrencies could weaken their grasp on the economy, monetary policymakers from Washington to Beijing are exploring issuing their own central bank digital currencies, or CBDCs.

Although a widely used digital dollar, euro or yuan may still be years away, such projects threaten to disrupt the financial services industry – galvanizing banks into action.

“CBDCs start a debate on the very essence of money that could have a big impact in almost everything we do, from securities processing to settlement,” said Swen Werner, managing director for digital assets at State Street.

Depending on the design, CBDCs might see central banks and tech players compete in the retail banking space while giving incumbents opportunities to cut costs and improve services.

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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