Despite rapid inroads made by mobile and card payments, cash still dominates consumer payments in the European Union, according to a new report by the European Central Bank (ECB).
The dominance of cash at the point of sale (PoS) in Europe is such that about 79% of PoS transactions were done in cash in 2016, amounting to 54% of the total value of payments.
In Germany -the bloc’s biggest economy, Austria as well as Slovenia, 80% of all in-store transactions were carried out in cash.
Cards were the second most frequently used payment instrument at POS. Cards were used for 19% of transactions, however made up 39% of the value of payments.
The study highlights that cash was least used in the Netherlands, Estonia and Finland, where its share in the number of transactions ranged between 45% and 54%.
Men and consumers aged between 40 and 64 prefer to use cash. Younger consumers aged between 18 and 39 carried out fewer cash payments.
The report says: “Although the share of contactless payments in many countries is still low, the survey results suggest that the speed with which such payments have been embraced in some countries may mean that once payment cards and PoS terminals are enabled with contactless technology on a wider scale, the share of contactless payments could increase significantly.
“Since contactless payments are typically relatively low value and 81% of all payments at POS are below €25, this could have a significant impact on the use of cash for smaller value payments, especially given that respondents who prefer cash and those who prefer cards both appear to place importance on the transaction speed of their preferred means of payment.”