CBDC Simulation

The challenge

Today, over 80 central banks are looking to introduce digital currencies in the near future. However, the impacts of Central Bank Digital Currencies (CBDCs) are still relatively unknown.

Many questions frequently cross the minds of central banks, regulators, banks and payment companies worldwide:

What impact will the introduction of a CBDC have on the financial and economic system?

Can CBDCs be configured without largely impacting the banking sector balance sheet?

Could card companies suffer a substantial decline in their transaction revenues?

Could financial inclusion increase by providing unbanked people access to CBDCs?

The solution

Built in partnership with Giesecke+Devrient, FNA’s CBDC Simulator delivers a flexible, agent-based model of any payment ecosystem. This enables regulators and financial system participants to rapidly test, model and simulate the economic and financial stability implications of introducing a CBDC.

The benefits

FNA’s CBDC Simulation solution will allow users to:

Test multiple policy inputs and specific CBDC models to understand potential impacts on different financial system parameters

Forecast and steer CBDC adoption and predict payment behaviours

Quantify the expected impact of a CBDC on the disintermediation of bank deposits and financial inclusion

Provide clarity to participants as to how a CBDC will affect their current ‘business as usual’ payment processing and choice of payment alternatives

Simulate ‘shocks’ and stresses to the new and existing payment system (e.g. bank runs)

Build a common understanding among stakeholders to accelerate decision making

Our expertise

The CBDC Simulation solution has been built using over 20 years’ of research and experience simulating critical payment systems and networks

FNA has worked extensively with central banks and financial institutions from emerging and developed jurisdictions

Our CBDC subject matter experts have over 125 years of collective central banking experience

We have published numerous research papers on the topic of simulation and CBDCs, including ‘Agent-Based Simulation of CBDCs’, by Amanah Ramadiah, Marco Galbiati and Kimmo Soramäki

We are regular contributors to leading international & trade publications including the BBC, Wall Street Journal and Risk.net

In 2022, FNA’s CBDC Simulation won the Digital Currency Award for Resilience

Our expertise in central banking has also been recognized by a series of industry awards, including winning the G20 TechSprint, and twice winning the Central Banking FinTech & RegTech Global Award for Best Analytics Partner