platform, both sets of parties can obtain access to one another quickly and relatively inexpensively. paypal, google wallet, applepay and others are providing innovative payment solutions. automated investment tools are also available online for investors. their growth has been impressive : across the globe, fintech companies are now collecting around us $ 1 billion per month in capital, and there are many pioneering companies, particularly in the united states. banks simply have to be in a state of high alert – not only because of the threat of a redistribution of profit margins, but also out of the knowledge that, in a fast - moving digital world, they could fall irrecoverably behind if they fail to respond quickly enough with competitive products. to put it differently : the banking industry cannot put their collective heads in the sand but have to rise to the challenge. and this is due not only to fintech companies and shrinking profit margins. what are termed “ disruptive technologies ” are playing a decisive role here. technologies are disruptive if they not only make individual processes more efficient but also render entire business models obsolete. once music started to be spread over the internet as compressed files, a whole value - added chain was suddenly rendered superfluous – from the cd pressing machine to the record store. smartphones, with their highly developed lenses, are currently putting pressure on the camera industry. the financial industry, too, needs to come to grips with these “ destructive ” technologies. mobile payment methods, for instance, could erode payment structures that have evolved over years. “ blockchain ” technology is credited with having a particularly sobering impact on banks. by using the global computer network, this technology is enabling all transactions conducted in the world of finance to be documented in a presumably forgery - proof, near - real - time and, above all, decentralised manner, ie potentially without central securities depositories or banks. any individual and any company could therefore settle money, securities or any other type of asset and liability directly with other financial market agents – thus obviating the need for the existing, unwieldy settlement infrastructure used by banks, csds and central banks. as a solution for the entire financial system, this technology is thus raising fundamental questions – including regulatory questions. banks are currently researching ways of using this new technology internally, especially for cross - border transactions. the us nasdaq stock exchange is already using blockchain technology for some of its services. bis central bankers ’ speeches

cash accounted for 47 per cent of the number and 18 per cent of the value of all payments in 2013, down from 62 per cent and 29 per cent respectively in 2010. cash was used particularly intensively for low - value transactions, with consumers using cash for around two - thirds of payments under $ 20. while the use of cash is declining relative to other payment mechanisms, it will continue to have a role in the economy. indeed, as the bank has noted previously, banknotes on issue have for a long period grown broadly in line with the nominal growth in the overall economy. and the consumer use survey suggests the amount of cash in respondents ’ wallets grew between 2010 and 2013. together, this evidence suggests that cash continues to have a significant role – not just for small - value transactions, but also both as a store of value and for precautionary use when other means of payment are not available. this is one of the reasons that the reserve bank is undertaking its next generation banknote program, which will ensure that australians can continue to have confidence in the nation ’ s banknotes as an effective means of payment and secure store of wealth. but this is not inconsistent with the bank ’ s desire to encourage the efficient use of electronic payments. a more marked decline is evident in the use of cheques. the number of cheques written in australia peaked around 1995. since then, the number of cheques written each year per capita has fallen by more than 80 per cent ( from 45 to 8 ). over the same period, the number bis central bankers ’ speeches of electronic payments per capita has risen by more than 400 per cent. as the use of cheques has fallen, the per - cheque cost to financial institutions and businesses has generally risen. the market has, and continues to, respond to these pressures by looking for more efficient ways to process cheques, but they are clearly the highest cost payment instrument, as will be confirmed when the bank releases its payments cost study later this year. this decline in the use of cheques, a very expensive payment instrument, is one that the private and public sector will have to manage. part of that will involve the introduction of effective and readily available substitutes for users, and initiatives such as superstream and econveyancing are likely to be part of this. central to the industry ’ s efforts to develop new payment products and services will be the new payments platform ( npp ). i would like to use my remaining