Quarterly Bulletin
e-commerce Articles
| Winter 2003 | Innovations
in retail payments: e-payments 
(114k)(by Helen Allen of the Bank's Market Infrastructure Division). Ways to make retail payments using the internet and mobile phones are proliferating. Some are offering new access routes to existing payment means, others use different means to transfer value, but all attempt to provide greater convenience and choice in payment services. Few, however, have reached critical mass and none has displaced existing payment methods. Nevertheless, the prospect that these new services could be widely used raises some policy questions. For example, central banks are interested in any potential effects on financial stability and, in the longer term, in whether such innovation might have monetary policy implications. For these reasons, central banks monitor the evolution of the market, even though any such impacts may be a long way off. Moreover, it may well be that the system-wide risks will be relatively small even if e-payment usage becomes significant. |
| Summer 2003 | Foreign
Exchange Joint Standing Committee e-commerce subgroup report
(54k) This article describes recent developments in electronic trading in the foreign exchange market, based on a report produced by the e-commerce subgroup of the Foreign Exchange Joint Standing Committee. After a brief introduction to e-commerce in the context of the foreign exchange market, it discusses developments in electronic trading, including both single-bank and multi-bank internet-based systems, and explains market initiatives such as 'prime brokerage' and 'white labelling' that have been facilitated by electronic platforms. |
| August 2000 | Common
message standards for electronic commerce in wholesale financial
markets The development of common standards is central to the move towards automated processing of trade data and the wider adoption of electronic commerce in wholesale financial markets. This automation is expected to bring significant efficiency gains, as well as a reduction in costs and risk. Initiatives led by market participants to establish common standards have made considerable progress. But it remains the case that too many trades in today's financial markets are still processed using fax or incompatible electronic networks. Standard-setting bodies continue to face difficulties in their efforts to gain widespread adoption of common and compatible message standards over the life of a trade. Competitive pressures may force common standards to be adopted more widely if they are associated with new technologies that give market participants new ways to reduce costs or improve services. The impact of XML, in particular, could be considerable. It has the potential to address some of the traditional failings of standards-that they are either too rigid, and do not reflect the needs of a particular market, or else that they are so flexible that they barely constitute a standard. It may also facilitate technological progress, by reducing firms' switching costs and so lowering barriers to entry and barriers to change. But this is likely to happen only if market participants work together to ensure that the XML-based standards that they create are inter-operable. The precise ways in which electronic commerce and the development of common message standards will affect market structure in the medium term are difficult to predict. But it is clear that changing technology has the potential to bring about significant changes: to the ways in which markets operate and to the roles of market participants. |
