A Hit to Digitalization: Cash Is Still Very Much Alive and Relevant for EU Citizens

A recent report prepared by ECB officials found that cash has maintained its relevance even in the EU, with predictions of a cashless society failing to materialize. While cash usage has been slowing down in the payments arena, its adoption has grown in other ways.

Study Finds Cash Is Still Somewhat King for EU Citizens

While cash has been underestimated by analysts predicting the arrival of a digital money age, studies are beginning to show that it remains relevant for European citizens and, surprisingly, for a younger demographic. A bulletin prepared by Alejandro Zamora Perez, Banknote Issuance Specialist at the European Central Bank (ECB), and Trainee Economist Rebecca Clipal reveals that cash is considered important by a significant number of people, even if it has been partially substituted in some use cases.

The report, which sources data from the last three studies on the payment attitudes of consumers in the euro area (SPACE) reports completed in 2019, 2022, and 2024, shows that cash possesses a “rarely anticipated persistence,” especially for storing value in the aftermath of the COVID-19 pandemic.

It states:

Younger individuals engage with cash across all functions, particularly holding it for precautionary reasons, whereas older groups use it for transactions more frequently than other age groups.

The perceived importance of cash as a payment option has grown since 2019. In 2024, cash was perceived as important by a wide majority of individuals across all age groups.

The findings clash with any plans to abandon cash in a future payments framework, with the report noting the numbers shed “further doubt on the maximalist position that expects a steep decline in the use of cash in the coming years.”

While Europe is on the verge of launching its central bank digital currency (CBDC), the digital euro, the ECB has clarified that it is not designed to substitute cash. Recently, Piero Cipollone, Member of the Executive Board of the ECB, stated that he institution remains “fully committed to cash” and is “working to ensure that it remains widely available and accepted.”

Furthermore, he stressed that “a digital euro will not replace banknotes and coins but rather complement them, offering a ‘digital expression of cash’ that expands the benefits of cash to digital payments.”

Read more: ECB Promotes Digital Euro as a Sovereign Cash Alternative