The corona lockdown will push back the use of cash – this narrative presented by digital natives may not pass the reality test: new data for the European market has shown a massive increase in cash withdrawals over recent months.
Fifty billion euros – this is how much cash withdrawals have increased by in Europe over the first five months of 2020, according to a statistic released by Buyshares, an investor platform. In total, European citizens withdrew some 1.34 trillion euros over this period.
It signifies the strongest increase since the financial crisis of 2008 and runs counter to common wisdom. Neobanks, payment service providers and fintechs have all claimed a stronger use of their services over recent months. Not least due to the rumors that the virus may potentially be transmitted via coins and notes.
According to Ancient Urge
But the digital industry wasn’t counting with the archaic urge to hoard cash in times of crisis. At the start of the outbreak in Europe in March, cash withdrawals surged.
Looking back over the past decade, which brought about a series of bigger and smaller crises, there’s a ready explanation for the total increase in the use of cash in Europe by 540 billion francs since 2010.
The Finnish Digital First-Movers
Countries that have a more shaky financial situation to deal with have a higher rate of cash holding as well. Top of the list are – unsurprisingly perhaps – Albania and Greece, followed by Balkan nations and other Southern European countries. The lowest level of cash outstanding per person was found in Finland.
