While the reality of the Internet boom in the nineties brought many e-commerce proponents to revalidate their expectations, the Internet provides us with an outreach, other than wireless technology, that surpasses any other known media. As a result e-commerce through the Internet has been gaining significance and its potential should not be discounted. In meeting this trend, the FPX is indeed a welcome development as a payment system that leverages on banking institutions’ Internet banking services to provide on-line assurance of payments, enables payment references to accompany payments to facilitate reconciliation of transactions, and provides an efficient and cost-effective settlement mechanism. The system is intended to support the various initiatives of the private sector and the government in e-commerce, through the use of an industry-wide payment platform that would have a more comprehensive out-reach to users, compared to the existing bank-centric models. It is our hope that the FPX would facilitate e-commerce transactions and encourage businesses to undertake process re-engineering to reach out to wider markets, facilitate end-to-end e-commerce transaction flows and reduce operating costs through the use of modern day technology. BIS Review 63/2004  1  Ladies and Gentlemen, The payment system landscape is continuing to evolve - shaped for the most part by the availability of various electronic payment infrastructures and the consumers’ adoption pattern. It is noted, however, that while a vast array of electronic payment systems and instruments have been introduced against a background of more flexible regulatory policies and advancements in technology, the use of cheques remains pervasive in Malaysia.

Carney (2015), ‘From Lincoln to Lothbury: Magna Carta and the Bank of England’. 6. On this point see also Feroli et al. (2017), “Language after liftoff: Fed communication away from the zero lower bound”, Research in Economics 71, 452–490; and Swanson and Williams (2014), “Measuring the effect of the zero lower bound on yields and exchange rates in the U.K. and Germany”, Journal of International Economics 92, Supplement 1, S2–S21. 7. Remember that the nominal rate of interest is the real rate plus expected inflation (πe). So the “neutral” nominal rate is something like i* = R*+πe. Broadly speaking, policy will be contractionary (expansionary) if the official interest rate is higher (lower) than i*. 8. Woodford and others have argued that QE works mostly because it signals something about future interest rates. See, for example, Woodford (2012) ‘Methods of Policy Accommodation at the Interest-Rate Lower Bound’, presented at Jackson Hole. For an overview of the transmission channels of QE see Broadbent (2017) ‘The history and future of QE’ and Bailey et al (2020) ‘The central bank balance sheet as a policy tool: past, present and future’, Bank of England Staff Working Paper No. 899. 9. There’s a formal description of the model, and how Charts 4-6 were generated, in an appendix at the back. 10. In this simple model, monetary policy affects inflation pretty much immediately. In the real world it takes time. Lags between policy and its effects are another reason why perfect stabilisation isn’t possible. 11.