いや、現金は死んでいないし、これからも死なない

There have been a number of stories in the press over recent weeks about cash, so it seems a good time to revisit the topic for a blog post.

A few stories have been based on surveys, which, at least in the resulting coverage, have resulted in mixed messages or, at the very least, demonstrated perhaps a lack of understanding by the journalist. Given we don't know where the issue lies, we'll avoid mentioning those involved.

A recent survey again demonstrated that Europe is not a single country. Each countries use of cash varies quite significantly. Yet there was an intimation that the high usage of cash was because there weren’t sufficient alternatives to cash, and then made the leap to the Digital Euro being the answer that will drive out cash. To be fair, I’m slightly exaggerating the links made, but it does reflect statements I’ve heard from a number of people.

There are a few things to unpick.

First, it’s rarely through lack of choice. Cards have been around decades, and are used to access ATMs to withdraw cash in the first place. Instead, the picture is more complex, and often has its roots not just in habits but in culture. The highest cash uses in Europe are Germany and Austria, both of whom have (broadly speaking) a cultural aversion to debt. Cash makes managing money easier for many – you can’t spend what you don’t have.

Second, it assumes that payment types are interchangeable, and that there is free choice. Many of us will have experienced shops and merchants that only accept cash, or, post-pandemic, only accept cards. In certain countries, it is virtually impossible to pay certain bills any other way than the way the biller wants. For example, try taking out a mobile phone contract in the UK without paying by direct debit!

Third, habit. Clients will know I talk about this a lot. How often do you change how you pay something? And if it isn’t seamless or universal, will you even try again? Whereas cash is universal and consistent.

Fourth, do we actually want cash to go away? Many people won’t, and increasingly it’s protected by the government.

This then is the reality. Cash isn’t going to go away anytime soon. Instead of positioning things like the Digital Euro as a “cash killer” (and to be fair, those behind the Digital Euro aren’t saying this), any new payment type needs to focus on the “why”, and then how to get to ubiquity. There have been countless other attempts that have failed, which should be a good indication that this won’t a simple task.