3.2 Security and Resilience

3.2 Security and Resilience

Increased digitalisation and fragmentation of the payment system with the emergence of more actors and payment methods than ever before, may increase the need for inter-operability, as well as a greater reliance and dependence on digital payment infrastructure. In the National Cyber Risk Assessment 2022[1], the impact of significant or prolonged disruption impacting upon payment, clearing and settlement arrangements have major disruptive effects that can impact upon all sections of the economy. This could, for example, impair the ability of Government and private organisations to process payrolls, undertake essential purchases and to make payments online. While this outcome is outside the scope of the NPS it is an important factor and consideration in the security and resilience of the overall system. The role of cash and the digital euro are both potential methods to improve system resilience that are within the scope of the NPS and will, therefore, be explored.

The use of cash at ‘point of sale’ (PoS) is falling steadily and we are increasingly using digital payment methods. Nonetheless cash serves an important contingency function for digital payments. For many people, cash also continues to be the payment of choice for a variety of reasons. Over the last number of years, we have seen significant changes in the cash cycle in terms of stakeholders and infrastructure[2] (as noted in the Central Bank of Ireland (‘Central Bank’) Access to Cash Report[3]). As a result, there is a continued need to ensure that a resilient cash cycle can absorb shocks without undue disruption. This will, therefore, be examined in the Strategy.

In order to ensure that the Irish payment system is resilient, it must be trusted by its retail participants and consumers. Fraudulent activity within the Irish system payments system can negatively impact its trustworthiness, and therefore its resilience. Consequently, the NPS will also focus on digital fraud and potential measures to reduce, and mitigate fraud as it evolves over time in an increasingly complex world.