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Citizens paid by card - and took cash back home

2021-06-19T03:56:09.189Z

The corona pandemic has given cashless payments a boom. But at the same time, according to the European Central Bank, the demand for euro notes increased.



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Photo: Patrick Pleul / dpa

The lockdown at the beginning of the Corona crisis revealed a hamster mentality in many people.

The Germans' purchases of toilet paper are now legendary.

Now the European Central Bank (ECB) has revealed another phenomenon of the pandemic: Although people in the euro zone were increasingly paying cashless when shopping, the demand for euro banknotes increased by 190 billion euros between March 2020 and May 2021.

According to the ECB, this is an increase of four percent when comparing the volumes issued in spring 2020 with the average volumes over the past five years. ECB director Fabio Panetta interprets the increased demand for cash as a need for a safety cushion. "This apparent paradox - an increasing demand for banknotes despite a decline in cash payments - can possibly be explained by the fact that people used cash during the crisis as a means of dealing with uncertainty," Panetta said at a Bundesbank cash conference on Tuesday took place.

Recent estimates suggest that even before the pandemic, only around 20 percent of the total amount of euro banknotes in circulation in the euro area was actively used for payments.

Panetta therefore assumes that euro notes and coins will survive the digital revolution.

Many citizens are critical of the digital euro

It is fitting that a majority of Germans are rather skeptical about a digital euro, according to a survey by the Bundesbank.

Around 56 percent of all households surveyed said this in their first assessment of the possible introduction of a digital euro, said Bundesbank board member Johannes Beermann at the cash conference.

Many are not convinced that a digital euro would offer sufficient additional value compared to the existing range of payment options.

While the discussion about a digital euro in the financial sector is in full swing, it does not seem to have really reached the general public.

According to the survey results, 77 percent of all respondents have not even heard of or read about a digital euro.

The ECB has not yet decided whether to implement the project.

According to earlier statements, a decision should come around the middle of the year.

mmq / Reuters

Source: spiegel

All business articles on 2021-06-19

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