Cash is disappearing,” says Bank of England official, and Spain?

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Cash, money, bank of england, credit card, debit card
Electronic cashier: Allows the payment of taxes by card or mobile phone.Credit: Ayto. De Fuengirola

Jon Cunliffe, deputy governor of the Bank of England, says cash is disappearing with improving technology growing the popularity of debit and credit cards. Online shopping, self-service, ease of use and security are all given as reasons for the decline in cash purchases which in 2019 accounted for only 23% of sales transactions.

Cunliffe, says that the percentage of cash transactions declined further due to the pandemic and highlights the need for politicians to support a new form of safe, flexible and useful money, such as cards and cryptocurrencies. An example of this is the attempt by authorities to put their faith in the Central Bank Digital Currency (CBDC), a proposal if adopted would work with online payment platforms and allow banks to further evolve their technologies alongside.

The situation in Spain is quite different with a recent survey by Plataforma Denaria published in September 2021, showing the need to preserve cash. According to the survey most Spanish consumers still consider cash to be critical to their lives, with a significant percentage of the population still living in less populated areas and therefore areas less well served by banks.

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Since 2008 bank branches have declined by almost 50% and ATMs by nearly 20%. That fact along with attempts during the pandemic to stop cash usage has resulted in the majority of the over the age of 45 believing there to be more barriers against usage than ever before.

Interestingly some 13,6% of respondents living in towns and cities with a population above 500,000 inhabitants said they had experienced difficulty in using cash in shops and restaurants. Conversely many of those in smaller more rural towns and villages still regularly frequent stores, bars and restaurants that do not have an electronic payment facility.

It seems that cash is only disappearing in those countries where the population is located predominantly in major urban areas and where lifestyle and shopping habits are more conducive to the change. Perhaps there is a role as pointed out by Cunliffe for governments to play an active part in the change.



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