The Impact of E-money on the Economy

From 1990psilas, e-money has developed very quickly. Many economists proposed their view by theory. They think that e-money, designed to substitute central bank currency, could take impact on money supply, especially on the narrowly defined stock of money, M1. In modern economy, money has played a very important role, so e-money has a big potential to affect GDP. The paper discusses how e-money has impact on M1 and GDP based on the data from 1990psilas to now. In the analysis, we can get following conclusions: (1) as a payment media, the development of e-money has increased rapidly, we can see e-money has very strong potential in economy. (2) Now, the volume of e-money is still very little. And e-money has little impact on M1 and GDP. (3) In a short time, e-money can hardly replace currency in circulation, and they will exist simultaneously for a long time. (4) Now it is unnecessary to carry out any policy to restrict the development of e-money. Such as e-money issue mechanism, but it is necessary to build an e-money balance report mechanism.