Development of electronic forms of money circulation as a basic trend of fintech

In recent decades, there has been a massive transition in the world from cash to electronic forms of money circulation, in particular, such as: cashless money; electronic money; Internet banking transactions; virtual local currencies; virtual money (cryptocurrencies); central bank digital currency. This transition is based on breakthrough innovations in areas such as computer technology, fiber optic communication lines, information technology, mobile communication, financial technology (fintech). Important drivers of the development of electronic forms of money were global challenges related to the global financial crisis of 2008, the COVID-19 pandemic and the full-scale Russian-Ukrainian war. This required the translation of many financial services into remote form – based on technologies such as artificial intelligence, Big Data, automation of robotic processes (RPA), blockchain, etc.

In Ukraine, electronic forms of money circulation began to be introduced a little later than in developed countries, so they immediately had a "raid" of financial technologies. And among the activities of Ukrainian fintech companies, those related to the electronic circulation of money, namely: payments and money transfers, mobile wallets, cryptocurrencies and neobanks, became dominant. It is these types of activities of fintech companies that provide a transition to a Cashless economy, which in the Fintech Development Strategy in Ukraine until 2025 is defined as its basic trend.

Based on the analysis of the current level of development of electronic forms of money circulation in Ukraine, it is shown that all of them have significant reserves for further development. Thus, for the widespread use of cashless money, it is important to demonopolize the card payment market, ensure the security of these payments, modernize the electronic payment system of the central bank, etc. To increase the volume of transactions with electronic money, it is important to comply with the new requirements for their issue and circulation. To increase the array of Internet banking transactions, it is important to ensure its legal regulation at the level of European standards, which involves the use of the BankID System, the assignment of an international IBAN number to accounts, the use of new software, etc. In the circulation of virtual local currencies, it is important to avoid various schemes for money laundering. And expansion in the money market of virtual currencies should not contribute imbalances to the monetary turnover of national currencies. The key to this should be the introduction of the digital currency of the central bank.