Head of the Cash Department at the Bank of Finland, Päivi Heikkinen, wrote a blog article for the central bank’s bulletin analyzing Finns’ use of contactless payments and other tools, including cash.
Indeed, the Bank of Finland found that there was a noteworthy surge in contactless payments between 2016 and 2017. Päivi explains this phenomena as being a direct result of merchants’ growing adoption of contactless POS terminals. Interestingly, although there is an increase in contactless, it has not been synonym to the drop in cash usage – as some might have predicted. On the contrary, contactless adoption has mostly affected traditional chip-and-pin cards. It has certainly affected the payment habits of those that traditionally used cash and cards interchangeably, dropping from 12% of the population in 2017 to 5% in 2018 in favor of cards. But for those that were mainly cash users, the number is not only stable but has in fact grown between 2017 and 2018, against all forecasts.
Reasons could be many, but Päivi explains this as proof that people that prefer cash actually stick to it regardless of the proliferation of payment options. Cash users generally express their preference as partially linked its convenience but also to its capacity to help them better manage their budgets thanks to its tangibility: a quality that no other payment has been able to equal. When there was a 100 bill but only a 20 is left in your wallet, there is no better proof of what was spent than what the eyes can see and the hands can feel!