According to the forecasts of the European Central Bank (ECB), it is becoming more and more important for consumers in the euro area to make payments without necessities and coins. Cash is still the most widely used payment method at checkout, according to a study released Tuesday by the ECB. But in terms of value, card payments have surpassed bills and coins for the first time.
The corona pandemic has accelerated the trend towards electronic payment tools. Most of the consumers now prefer electronic payment tools.
According to the research, 59 percent of point-of-sale transactions this year were cash. Three years ago it was 72 percent. That’s why notes and coins are still the most widely used means of payment for smaller sums in stores. The majority of consumers (60 percent) consider it important to have cash as a payment option to track their spending and protect their privacy.
In contrast, consumers in the eurozone usually pay higher amounts by card. The share of card payments in transactions rose 9 percentage points to 34 percent compared to the last survey in 2019, and consumers rely heavily on contactless payments. Maps are considered faster and easier to use.
Banknotes and coins are most popular in Malta. Banknotes and coins still dominate here, as measured by the number of transactions and the value of payments. In Germany, people’s love of cash as a means of payment has waned, as a study recently published by Deutsche Bundesbank reveals. Most payment transactions for goods and services are made here in notes and coins. But in terms of sales, the card is now ahead.
According to the ECB, mobile payment with a mobile phone, for example, is gaining importance among people in the eurozone. But so far the share is only 3 percent of transactions and 4 percent of value. The share of online purchases in all day-to-day transactions in the euro area increased from 6 percent to 17 percent in 2019.
“The ECB is committed to ensuring that consumers are free to choose how they want to pay, both now and in the future,” said Fabio Panetta, member of the Board of Directors. “With our commitment to cash and our ongoing work on the digital euro, we want to ensure that paying in public money is always an option.”
By the way, cash won’t have to be accepted in Switzerland anytime soon. At least that’s the view of the Federal Council. He thinks that the obligation to accept cash is a huge infringement on economic freedom and freedom of contract.
On December 9, the Federal Council approved a report on behalf of the Parliament. He is of the view that “large-scale disappearance” of cash should be avoided unless there is an equivalent cashless alternative.
However, as it stands today, the Federal Council wants to give households and companies a choice between cash and alternative payment methods. It considers a mandatory obligation to accept cash neither appropriate nor necessary.
(SDA)