The Impact of e-CNY on Commercial Bank Deposits

With the spread of e-CNY, many banks have begun to explore the prospects of commercial bank deposits. Based on a review of the literature, this paper investigates the impact mechanisms of e-CNY on bank deposits from the perspectives of customer asset allocation and bank asset-liability management. Different people and enterprises have different liquidity needs and desired returns; therefore, they use banks for some purposes and digital wallets for others. Based on the above, the problems are mainly structural and under certain circumstances. Transactional funds are more likely to be withdrawn; time deposits will be relatively stable. The impact on bank lending and liquidity depends on the destination and speed of fund transfer, the bank's capacity to replace lost funds, its funding structure, and the operational arrangements of the central bank. The effect will also differ for banks with different customer bases and access to other funds. In light of the institutional changes introduced by e-CNY 2.0, this paper will further separate changes in account deposits from real reductions in bank liabilities. Strengthen the supervision of fund flows, improve scenario-based stress testing, and implement differentiated supervision. These measures will guide the deposit management and other policies of commercial banks. In addition, some empirical research has used both wallet-level and bank-level data to explore how the composition and liquidity risk of deposits have changed.