Macklem says stable, secure money and payment innovation will underpin Canada’s monetary future
Bank of Canada Governor Tiff Macklem used a year-end speech in Montréal to explain how the central bank is working to protect the integrity of money as Canada’s financial system evolves.
In remarks titled “Good money and your central bank,” he set out a wide-ranging view of the Bank’s role, covering everything from physical cash to digital payments and emerging technologies.Macklem framed his message around public confidence, arguing that trust is the foundation of any effective monetary system.
“Trust that the bank notes we issue are secure. Trust that our financial system is stable and efficient, so you can be confident that your money is safely stored and easy to use. And trust that the purchasing power of your money will be stable,” he said.
The governor stressed that the bank’s responsibilities go beyond issuing currency and setting interest rates, highlighting that ensuring that all forms of money work seamlessly together - whether held as cash, deposits or electronic balances - is essential to maintaining confidence and economic stability.
Despite the steady decline in cash use for daily purchases, Macklem noted that bank notes remain important for many Canadians and serve as a critical backup in times of stress. A new series of notes, including a redesigned $20 bill expected in early 2027, will feature enhanced security and a vertical layout.
The governor also pointed to the growing importance of digital payments with the BoC having taken on a supervisory role over retail payment systems, overseeing payment service providers to reduce operational and security risks as Canadians increasingly rely on electronic transactions.
Modernising the country’s payments infrastructure is another priority and Macklem highlighted progress toward faster, always-on payments through initiatives such as Real-Time Rail, which is intended to allow near-instant settlement between financial institutions.
Innovation, he said, must be balanced with stability. The central bank continues to study digital currencies and other new forms of money to ensure that any future developments align with its core principles: “Money that is safe, money that trades at par in all its forms, and money that has stable purchasing power.”
Overall, Macklem’s remarks signal a broader view of the Bank of Canada’s mandate, combining inflation control with stewardship of a rapidly changing monetary system, aimed at ensuring Canadians can rely on “good money” regardless of how they choose to use it.
