Our societal mission related to payments is to ensure that the payment system remains secure and efficient in the future and that it will still be attractive for businesses and individuals to make payments in NOK.

The question we and many other central banks have asked ourselves, is whether a CBDC can make a contribution in this regard.

There are several reasons:

• New players and solutions in the payment market
• Digital contingency arrangements
• Declining cash usage

Norway is among the countries in the world where cash usage is at its lowest. Even so, physical cash is an important part of contingency arrangements. The question is whether this will continue to be the case in the years to come.

Today’s digital payment solutions are also closely interconnected and vulnerable to cyber-attacks and technical disruptions. A CBDC, relying on systems that operate separately from the payment solutions we know today, can help to strengthen our contingency arrangements.

A CBDC can also be a platform for payment system innovation. Such a platform could facilitate competition in further developing payment services. New and attractive NOK payment services developed on this platform could prevent money and payment functions from being shifted to new arenas, such as crypto-assets or a payment system dominated by a few large, global players.

Because the payment system is so vital to society, it is crucial to have sufficient national control and supervision over its organisation and operation. Together with other payment system participants, we must meet safety, contingency and efficiency requirements and ensure that the solutions we choose promote financial stability. If novel types of money become widely used, Norges Bank’s ability to conduct an independent monetary policy could be challenged.

In our investigation, we also need to explore the potential drawbacks of a CBDC. In a totalitarian regime, a centralised digital payment system could be abused, such as for surveillance of its citizens. Therefore, it is crucial that any potential Norwegian CBDC is soundly rooted in democratic institutions, with strict built-in limitations on data collection and usage - as we have in many other areas.

Norges Bank has not yet concluded on whether to recommend the implementation of a CBDC, and if so, with which technology. We will continue to analyse possibilities and implications and test potential solutions. Our current objective is to develop the best possible basis for making a decision. The final decision on whether to introduce CBDC in Norway will be made by the Storting (Norwegian parliament).