The pandemic sparked a pointy decline in the usage of money throughout the eurozone, as the quantity shoppers spent in particular person utilizing playing cards overtook purchases with notes and cash for the primary time.

The European Central Financial institution stated card funds rose to 46 per cent of face-to-face transactions by worth, up from 43 per cent three years in the past, whereas the usage of money slipped from 47 per cent to 42 per cent. 

The study additionally discovered funds made utilizing cellphones tripled to 10 per cent of person-to-person funds over the previous three years, whereas on-line funds for getting meals or day by day provides from supermarkets and eating places additionally rose at the same price to 17 per cent. 

The findings — primarily based on a ballot of 39,765 individuals — point out the coronavirus lockdowns imposed throughout Europe accelerated the long-running development for shoppers to make use of money much less, at the same time as some international locations like Italy are searching for to guard transactions utilizing notes and cash.

Line chart of Share of payment transactions used at the point of sale in the eurozone (by value of transactions) showing Cards have overtaken cash by total amount spent

Nevertheless, hoarding money reserves grew in recognition, with 37 per cent of shoppers stashing banknotes at residence, up from 34 per cent three years in the past. The ECB, which has imposed unfavorable charges on eurozone banks since 2014, stated the development could mirror the uncertainty brought on by the pandemic.

Money was nonetheless the dominant cost methodology by variety of transactions, though it dropped from 72 per cent in 2019 to 59 per cent this 12 months. Money utilization for in-person funds ranges from 77 per cent of transactions in Malta to 19 per cent in Finland.

Line chart of Share of payment instruments used at the point of sale in the euro area (by number of transactions) showing Paying with cash is on the decline

Simply over half of shoppers stated they’d not modified how usually they used money for the reason that pandemic hit. However 31 per cent stated they have been utilizing money much less usually, whereas 14 per cent stated they have been utilizing it extra. 

The principle cause individuals gave for utilizing money much less usually was that paying electronically had develop into extra handy. Many additionally stated they have been heeding official advice to keep away from money funds. 1 / 4 cited the chance of catching Covid-19 from dealing with money, regardless of this threat being “proven to be principally unfounded in current microbiological research”, the ECB stated.

There have been additionally indicators of individuals’s attachment to money persevering with to wane. Six out of 10 shoppers stated it was pretty necessary or essential to have the choice to pay in money. That was down from 65 per cent in 2019.

Italy’s rightwing authorities this week scrapped plans to permit native retailers to refuse digital funds for transactions underneath €60, averting a possible showdown with Brussels on the usage of money. However Rome is urgent forward with plans to lift the authorized restrict on money transactions from €2,000 to €5,000, sparking fears it might allow extra tax evasion.

Money is the popular cost instrument for less than 18 per cent of Italians surveyed by the ECB, which is greater than 7 per cent in Finland, however under the eurozone common of twenty-two per cent. Austria has the best choice for money at 45 per cent, adopted by Germany at 30 per cent.

The ECB plans to resolve in October 2023 whether or not to press forward with plans to launch a digital euro, which it has stated will present a brand new means for individuals to entry central bank-backed cash in a digital type. 

“Our dedication to money and our ongoing work on a digital euro goals to make sure that paying with public cash is all the time an choice,” stated ECB government board member Fabio Panetta on Tuesday.

Crypto belongings reminiscent of bitcoin are owned by solely 4 per cent of shoppers within the euro space and over two-thirds of those stated they used them for funding somewhat than cost, the ECB stated.

The survey was carried out in late 2021 and spring 2022. The subsequent survey is because of be revealed in 2024.


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