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Publications on Banknotes & coins

18 March 2024
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 2, 2024
Details
Abstract
This article uses comprehensive ECB survey data to examine the narrative that a general shift towards digital payments is generating a sharp divide in payments behaviours, creating a binary world of digital “haves” and analogue “have-nots”. Our analysis challenges this narrative, revealing a more complex reality of payment behaviours at the point of sale. We focus on lack of ownership of the primary tools enabling digital payments in the euro area: debit or credit cards and payment accounts. In particular, we examine the group of people who lack at least one of these tools (either a debit or credit card or a payment account), assessing their cash payment patterns and their socio-demographic profiles against the rest of the population. The findings establish that cash remains a significant part of the payments ecosystem, even among people with both cards and accounts. Additionally, we show that the group of people without either cards or accounts has a diverse demographic profile. The analysis also assesses the reasons behind not having at least one of these two tools to enable digital payments. We show that perceived physical banking presence (defined as considering it easy to reach a bank branch or an ATM) is of limited importance, suggesting that personal choice or other demand-side factors may be of greater importance. We also show the relevance of payment habits through the persistence of cash habits even after the coronavirus (COVID-19) pandemic. The results are in line with the cash and retail payments strategies of the Eurosystem, which emphasise the need for a balanced approach that accommodates both the enduring role of cash and digital innovation.
JEL Code
E41 : Macroeconomics and Monetary Economics→Money and Interest Rates→Demand for Money
O33 : Economic Development, Technological Change, and Growth→Technological Change, Research and Development, Intellectual Property Rights→Technological Change: Choices and Consequences, Diffusion Processes
E42 : Macroeconomics and Monetary Economics→Money and Interest Rates→Monetary Systems, Standards, Regimes, Government and the Monetary System, Payment Systems
E58 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Central Banks and Their Policies
O52 : Economic Development, Technological Change, and Growth→Economywide Country Studies→Europe
11 December 2023
OTHER PUBLICATION
2 August 2022
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 5, 2022
Details
Abstract
In the digital age, innovation in retail payments is influencing payment choice and transforming the payment landscape. However, survey evidence indicates that for the largest share of transactions at the point of sale euro area citizens choose to pay in cash, and some of them have no other payment option. It is a responsibility of central banks to ensure adequate access to cash to guarantee consumers’ freedom to choose their method of payment and to prevent financial exclusion. This article describes the situation as regards access to cash in the euro area and the ongoing work by the Eurosystem to ensure that access to cash remains adequate.
JEL Code
E58 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Central Banks and Their Policies
E41 : Macroeconomics and Monetary Economics→Money and Interest Rates→Demand for Money
R12 : Urban, Rural, Regional, Real Estate, and Transportation Economics→General Regional Economics→Size and Spatial Distributions of Regional Economic Activity
G21 : Financial Economics→Financial Institutions and Services→Banks, Depository Institutions, Micro Finance Institutions, Mortgages
Network
Eurosystem Research Network on Cash (EURECA)
22 March 2021
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 2, 2021
Details
Abstract
What explains the strong growth of euro banknote demand, given that the transactional use of banknotes seems to have decreased? Key to explaining this phenomenon – referred to as the “paradox of banknotes” – is acknowledgement of the importance of all three components of banknote demand: euro area transactional demand, euro area store-of-value demand and foreign demand. This article explains these components and estimates their relative size. It also addresses COVID-19-related banknote developments during 2020, highlighting the importance of cash during crises.
JEL Code
E41 : Macroeconomics and Monetary Economics→Money and Interest Rates→Demand for Money
E51 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Money Supply, Credit, Money Multipliers
E58 : Macroeconomics and Monetary Economics→Monetary Policy, Central Banking, and the Supply of Money and Credit→Central Banks and Their Policies
Network
Eurosystem Research Network on Cash (EURECA)
2 December 2020
OTHER PUBLICATION
24 September 2018
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 6, 2018
Details
Abstract
This article presents the developments in the circulation of euro banknotes and the underlying drivers of cash demand in the euro area and abroad. Cash in circulation is on the rise, both in the euro area and abroad. In addition, data from a survey on the use of cash in the euro area indicates that by volume and number of transactions cash remained the most used payment instrument in 2016. However, the growth in banknote circulation can only partially be explained by transaction demand. Most euro banknotes in circulation are used as a store of value and households and firms inside and outside of the euro area obviously value the option of storing part of their assets in central bank money. Considering the currently low opportunity costs of holding cash, the stored euro banknotes can be expected to return if interest rates were to increase. However, as shown by developments over the past ten years, the store of value function is determined not only by interest rates, but also by external events which cannot be predicted. The demand for banknotes has also been impacted by various additional factors such as the financial and sovereign debt crises, geopolitical uncertainties, exchange rate developments and policy decisions
JEL Code
D12 : Microeconomics→Household Behavior and Family Economics→Consumer Economics: Empirical Analysis
E41 : Macroeconomics and Monetary Economics→Money and Interest Rates→Demand for Money
E42 : Macroeconomics and Monetary Economics→Money and Interest Rates→Monetary Systems, Standards, Regimes, Government and the Monetary System, Payment Systems
Network
Eurosystem Research Network on Cash (EURECA)
20 September 2017
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 06, 2017
23 July 2015
OTHER PUBLICATION
26 March 2015
OTHER PUBLICATION
14 April 2011
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 4, 2011
21 April 2009
OTHER PUBLICATION
21 April 2009
OTHER PUBLICATION
29 May 2008
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 5, 2008
21 April 2008
OTHER PUBLICATION
21 April 2008
OTHER PUBLICATION
11 October 2007
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 10, 2007
23 April 2007
OTHER PUBLICATION
23 April 2007
OTHER PUBLICATION
12 April 2007
OTHER PUBLICATION
21 December 2006
OTHER PUBLICATION
7 August 2006
OTHER PUBLICATION
25 April 2006
OTHER PUBLICATION
13 January 2006
OTHER PUBLICATION
11 August 2005
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 8, 2005
26 April 2005
OTHER PUBLICATION
6 January 2005
OTHER PUBLICATION
12 August 2004
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 8, 2004
27 April 2004
OTHER PUBLICATION
1 September 2003
OTHER PUBLICATION
17 July 2003
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 7, 2003
10 April 2003
OTHER PUBLICATION
23 January 2003
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 1, 2003
29 October 2002
OTHER PUBLICATION
30 June 2002
OTHER PUBLICATION
24 May 2002
OTHER PUBLICATION
9 May 2002
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 5, 2002
10 April 2002
OTHER PUBLICATION
Related
1 April 2002
OTHER PUBLICATION
24 January 2002
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 1, 2002
18 October 2001
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 10, 2001
1 May 2001
OTHER PUBLICATION
19 April 2001
ECONOMIC BULLETIN - ARTICLE
Economic Bulletin Issue 4, 2001
1 April 2000
OTHER PUBLICATION
9 November 1999
OTHER PUBLICATION
1 April 1999
OTHER PUBLICATION

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