of japan ’ s payment and settlement systems : “ the objective of the bank of japan,..., is to issue banknotes and to carry out currency and monetary control. in addition..., the bank ’ s objective is to ensure the smooth settlement of funds among banks and other financial institutions, thereby contributing to the maintenance of an orderly financial system. ” to fulfill this mission, the bank of japan performs a variety of functions. first, it provides the medium of settlement in the form of bank of japan notes and current account services, and constantly strives to improve efficiency and safety. its function to examine the authenticity of banknotes and prevent counterfeiting while securing the efficient circulation of banknotes lays the foundation for public confidence in banknotes. furthermore, the bank has been making various efforts to improve the efficiency and safety of the settlement system for funds and government securities by providing online services for current accounts through the boj - net system. in addition to such efforts, the bank of japan conducts on - site examinations and off - site monitoring of financial institutions that hold current accounts with it, and obtains information regarding their financial strength and risk management. if a financial institution faces a liquidity shortage that might seriously impair the smooth operation of payment systems, the bank of japan will provide liquidity as the lender of last resort, thereby preventing systemic risk from emerging. with this preamble, let me turn to the role of the bank of japan in securing efficient and safe payment systems, thereby maintaining financial system stability under innovation in information and communications technology. payment systems in japan consist of those operated by the bank of japan and private sector ones. in view of the fact that payment systems are a fundamental infrastructure for economic activity, it is always important to maintain the safety of payment systems as a whole regardless of whether technological innovation creates a new provider, a new channel or a new means of payment. in this regard, all related parties, that is, financial institutions, the steering bodies of private payment systems and the central bank, need to be in close contact and make efforts to discharge their respective responsibilities. the bank of japan provides a settlement service called boj - net. boj - net is the core settlement system for yen funds and government securities and is participated in by major financial institutions and private payment systems. we continue to make efforts to accurately grasp new waves of innovation in information and communications technology and to make our settlement systems support the advances of financial institutions and private payment systems.

of banks or country ’ s economic growth. neither the corporate nor the household sectors were left without credits, which only disproves the “ forecasts ” put forward by opponents of central bank ’ s measures. profit interest of banks appears not to have been affected by these measures either, since august data put interest rate margin in serbia at approximately 11 percentage points ( weighted average interest rates on total credits and total deposits were 16. 43 % and 5. 55 %, respectively ). in romania, which is on the point of eu accession, this same margin is still around 9 percent! those who wonder why interest rate margins range between 4 and 7 percentage points in a majority of transition countries, and between 4 to 5 % in eu countries, i. e. why they are lower than in serbia, ought to have in mind the following facts : 1 ) our country rating is still bb -, almost exclusively because of high political risk, 2 ) until only few months ago, we had double - digit annual inflation, 3 ) a large part of the corporate sector is still waiting to be restructured, with monopolies maintained or created in several branches of economy! but let us go back to our starting point – bringing down inflation, although it entails costs that are not insignificant for the nbs, for banks or the government, is a priority, because low inflation creates real scope for lower interest rates. with the decline in inflation that occurred over the past five months, we can already see the beginning of this process in practice, and all that the nbs can now do is “ promise ” that monetary policy will be as restrictive as necessary in order to accomplish the set inflation objectives. high inflation is an additional tax affecting the poorest of the population, first by directly reducing the value of their income, and then also because it leads to a decline in foreign direct investments, which in turn narrows down opportunities for new and productive employment. the dinar is our currency, and i am surprised that the government nominally advocates its use, while at the same time calculating all important things in euros – credits extended by the government are in euros, national investment program is expressed in euros, country debt is disclosed in euros only – as if the government has left serbia and now lives in another country. i firmly believe that our citizens are ready to pay a certain cost of credit, but that they are not ready to buy a “ pig in a poke ” or take credits on imprecise terms or terms