Money and payments
One of the basic tasks of the Bank of Finland is to maintain the cash supply and issue banknotes in Finland. Russia’s war in Ukraine increased the demand for cash in 2022. The Bank of Finland considers that securing cash services is important and will remain so in the future.
Backup systems were created in 2022 for securing daily payments in emergencies and in the event of disruptions.
These backup systems include the national emergency account system, which also allows cash withdrawals, debit card payments and credit transfers.
Development of a digital euro continued in 2022
Electronic payment is increasingly popular in Europe. Many of today’s electronic payment solutions are dependent on payment service providers located outside Europe.
Work on a possible central bank digital currency – a digital euro – forms part of the careful preparatory work to meet the changes in the operating environment brought by digitalisation. The aim of a digital euro would be to strengthen the strategic autonomy of Europe and the role of central bank money as a monetary anchor.
In 2022, a national monitoring group for the digital euro project was established in Finland, headed by the Bank of Finland and consisting of payment service providers, banking sector representatives and public authorities.
Demand for cash grew by more than expected in 2022
The outbreak of the COVID-19 pandemic in 2020 led to a decrease in the use of cash and weakened the profitability of cash services and therefore the availability of such services. Russia’s war in Ukraine, in turn, increased the importance of cash in contingency preparations for a crisis.
The Bank of Finland proposed a legislative initiative in 2022 for safeguarding a sufficient level of cash services in Finland.
International cooperation and protecting financial sector services from cyber risks are important
Russia’s war in Ukraine and Finland’s NATO membership process have increased the threat to Finland’s critical infrastructure, also in the cyber environment.
According to the National Cyber Security Centre, Finnish organisations too are being targeted directly, which underlines the importance of protection and testing as well as international cooperation.
Bank of Finland continued to develop payment systems in support of financial system stability
The Bank of Finland provides the Eurosystem’s common TARGET services to Nordic financial sector entities.
In 2022, the Bank of Finland maintained the current systems and actively participated in new TARGET development projects.
The reliable functioning of TARGET systems is part of financial system stability.