by Dr Carlos León and José Fernando Moreno Gutiérrez

Central bank digital currencies (CBDCs) and other forms of digital money are here to stay. As intermediaries in the funding and payments ecosystems, commercial banks will see their business-as-usual activities affected. Commercial banks need quantitative insights into how they will be affected to thrive in this changing environment. 

FNA has developed a flexible solution that enables commercial banks to simulate the economic impact of retail CBDCs on their balance sheet structure. With FNA’s CBDC Simulation Solution, commercial banks and other payment system providers can prepare for transitioning to this new era.



In recent years, new forms of digital money have appeared on the scene. Retail CBDCs –a new digital version of claims to the central banks– along with crypto assets and stablecoins, have challenged the mainstay of the financial system. Commercial banks face unprecedented challenges maintaining their funding and payments business-as-usual. Key questions about these challenges include:

  • How will commercial banks’ balance sheets be affected?
  • How could commercial banks adapt to this new environment? 
  • Which is the most convenient arrangement for banks if they distribute CBDC?

To address these questions, FNA presents a CBDC Simulation Solution that enables commercial banks and other payment system providers to rapidly and flexibly test, model, and simulate the impact CBDCs –and other digital forms of money– could have on the commercial banks’ balance sheets, liquidity, and business models.


About ninety central banks are looking to introduce CBDCs in the short and medium term. At the same time, the stable coin market keeps growing in number and value. New digital forms of money and credit methods, like digital wallets and buy now pay later platforms, have been growing faster worldwide. In accordance, not only central banks but also commercial banks and other payment system providers need to understand and visualize the importance of new forms of digital money in their activity. 

These institutions will have a better overview if they analyze multiple CBDC designs, if they incorporate other payment methods, and if they model the interaction between all the agents that affect their business. FNA’s CBDC Simulation Solution is then the proper tool to be part of the discussion.

Banks should choose FNA due to its industry-leading analytics technology, strong reputation working with the world’s largest central banks, financial market infrastructures (FMIs) and banks, and significant experience designing, modeling, and simulating payment systems. CBDC solution has been built using over 20 years of research and experience running simulations on critical payment systems and networks.




FNA’s CBDC Simulation Solution is about introducing a CBDC under a wide range of design options (e.g., caps on balances, remuneration, anonymity), behavioral rules, and country-specific features into a simulated model of a retail payment system. The solution’s outcome comes in the form of the main macro-financial results after a CBDC or other digital currency is added to the system. 

The CBDC Simulation Solution uses an agent-based model to combine sub-models representing agents, payment instruments, and the environment, where agents interact through those instruments. The simulator considers several agents, such as the central bank, commercial banks, payments system providers, merchants, and consumers, who interact by making transfers and payments among them with the available payment instruments. 

The solution provides a stylised framework for commercial banks to simulate the impact on their balance sheet and understand better how the different design choices affect the adoption of the CBDC and their business-as-usual. Banks can test scenarios and study their effect on their business-as-usual, from pledging high-quality liquid assets to borrowing central bank’s cash and CBDC, to the changes in the balance sheet composition due to the migration of clients’ deposits to CBDCs.

Calibrating the CBDC Simulation Solution with aggregate statistics of the German retail payment market estimates that the adoption of CBDCs led to the decline of cash and card payments up to approximately 30%. To put this finding into perspective, the latter indicates that card companies would lose roughly EUR 1.5 billion in transaction revenues in the German domestic payments market.

Furthermore, looking for the impact on the banking disintermediation and balance sheet, the simulation estimates that the total value of CBDCs in circulation would be 2.8% of the total deposits, corresponding to EUR 75.04 billion in the German banking system. It also reveals that, following the introduction of the CBDC, the growth rate of the bank deposits would decline by 0.75% in 20 days. This number corresponds to the fall of approximately EUR 20 billion in the German banking market.



1. Simulate multiple policy inputs and CBDC design configurations

There is no agreement about CBDC design and implementation. A flexible CBDC design configuration is essential to obtain better insights and scenarios. Furthermore, setting up existing and new payment instruments into a framework is compulsory for decision-making.

The CBDC Simulation Solution can model the CBDC adoption under various design configurations. From CBDC balance remuneration to caps on balances or transactions, the model will simulate adoption scenarios consistent with the features of the economy and the behavioural rules selected for its consumers and merchants. Accordingly, adoption scenarios will allow users to gain quantitative insights about what the rollout of the CBDC looks like–instead of relying on qualitative judgment alone.


2. Estimate balance sheet and liquidity impact and shocks

The adoption of new digital forms of money has the potential to affect the balance sheet of commercial banks. CBDC won’t be the exception.

Uncertainty about how the adoption of CBDCs will change the way banks borrow from and lend to firms and households requires a quantitative approach to design strategies to mitigate related potential negative impacts properly


3. Build a common understanding among stakeholders to improve decisions making

Commercial banks should be part of the debate around the CBDC issue. They will be affected by the adoption of CBDCs and will play a critical role in its rollout under intermediated CBDC schemes. Therefore, to adapt to this new environment and successfully perform their role as distributors of CBDCs, commercial banks need sound methods that provide clear insights and ideas for the discussion.FNA facilitates the discussion around CBDC with the experience obtained from years of working with the most important central banks, financial market infrastructures, and financial institutions worldwide. The CBDC solution has aroused the curiosity of many stakeholders leading the debate. That is because our agent-based modelling framework is flexible and extendable, able to address the main existing and forthcoming concerns about how the CBDCs roll out will bring in the future.

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