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Cash dominates in Europe

Categories : Cash is trust
September 1, 2016
Tags : Alternative modes/methods of payment, Demand, Europe, Trust
Cash demand is rising in Europe as people rely more on paper money than on new technologies.
Communication Team / Equipo de Comunicación

According to data from the PYMNTS Global Cash Index report on cash usage in Western Europe, the demand for cash is increasing in this region and should grow further in the next five years. In 2015, cash transactions accounted for €2.1 trillion and represented 89% of the European Union’s GDP. 

Demand for cash rose significantly after the collapse of Lehman Brothers in 2008 and should continue growing in the coming years, especially in Italy, France, Germany and Spain. Consumer behaviours observed in Southern Europe showed that a great number of people rely more on cash during periods of economic uncertainty, cementing the cash use dynamic.

Moreover, new digital technologies do not enjoy the confidence of all consumers as they are exposed to cyber-attacks including identity theft. Data collected in a research on ATM usage in the U.K. indicate that contactless payments are now used by about 30% of the population but mainly for small transactions of less than £10 such as subway rides, while cash payments average £50 to 60.

The adoption of modern technologies also depends on their ubiquity. Indeed, many merchants cannot process new payment methods such as mobile transactions as they are not equipped with wireless devices. The survey on ATM usage in the U.K demonstrated that 44% of customers will not visit a specific shopping street again if there is no ATM there, representing losses of tens of billions of pounds for local retailers.

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