Before the Corona crisis, it was like living at the limit in Germany, leaving the house without coins and bills. Paying for a roll at the bakery? A hopeless undertaking in many places. And also in some pubs the companions had to help out with cash. But since terms such as “distance” and “contactless” have made their way into the vocabulary used on a daily basis, card terminals are available in more and more shops and restaurants. And this probably explains why people in this country only carry around EUR 74.80 in cash on average – almost EUR 15 less than the year before. This is shown by a representative survey by the payment service provider Klarna.
For a long time, the Germans’ penchant for cash was considered unshakable. While the Dutch or Swedes often pulled out their cards or smartphones at the cash register years ago, in Germany according to figures from the European Central Bank (ECB) in 2016 it was still 80 percent all on-site payments to be paid in cash. People in this country attach more importance to data protection than elsewhere in Europe. Some fear that only paying with the card instead of anonymously in cash could turn them into a transparent citizen.
This concern is apparently disappearing, especially among young people: the Klarna survey shows that a fifth of 18- to 24-year-olds no longer use any cash in retail. One in seven respondents over 55 said this. In addition, more and more people are also paying smaller bills with cards, smartphones or smartwatches. Other surveys have also come to similar results in the past few months.
Since the pandemic, many people have found cash to be unsanitary
“The crisis has accelerated a trend that had already become apparent in previous years,” says Nils Beier, an expert in payment transactions at the consulting firm Accenture. In fact, the share of card payments in all transactions had risen steadily in previous years, as shown, for example, by regular surveys by the Bundesbank. “This is mainly due to the fact that alternative offers, such as the contactless Girocard, have become faster and faster. At the same time, younger people tend to be more open to new technologies such as paying by smartphone,” says Beier.
The impact of the pandemic is another factor. According to current knowledge, cash does not increase the risk of Covid 19 infection. But at a time when you no longer shake strangers’ hands and shouldn’t even touch your own face, it still seems inappropriate to many people to touch coins and bills that have already passed through numerous hands. As figures from the retail research institute EHI show in May, contactless payment options in particular are driving the shift away from cash. The motto is: hands off, as best you can.
The trade itself has also contributed to this. Since the beginning of the Corona crisis, many supermarkets have been advising customers to make contact-free and therefore cashless payments. For hygienic reasons, as Aldi Süd emphasized in the past. It is not cheaper for the supermarkets to process card payments compared to the value transport for cash.
Pandemic or not: Expert Beier believes that the development away from paying with notes and coins will continue – albeit slowly. “It will be a while before people will leave the house without a wallet without feeling like they have forgotten something,” he says. However, he also emphasizes: The 74.80 euros that are ready in the wallet are just a piece of cake compared to the cash that many people store at home in stockings or caskets as nest egg.