A common argument made in favor of central bank digital currency (CBDC) is that it could boost financial inclusion. The nuances of how to accomplish that goal, or even what “financial inclusion” means, remain to be explored, a Bank of Canada discussion paper said. It concluded that central banks will face a range of unfamiliar and nontraditional challenges to create an inclusive CBDC.
By “identifying material barriers and describing the realities of inequity underlying the aggregate statistics that are commonly used” the authors of the paper identified three types of inclusion necessary for a universally accessible payment method: financial inclusion, digital inclusion and practical accessibility. Private financial institutions may not have an incentive to address the needs of those who are underserved. In this light, the authors said: