The economy as a whole and specifically payments are seeing their organic move to a more digital space pushed up a notch due to COVID-19. However, countries that are still heavily cash-reliant will need more time to transition to digital, as evidenced by the current record ATM withdrawal figures.
Countries have been shifting towards increasingly cashless payments since the internet and mobile devices became truly mainstream. Some of these countries are now only years away from having only a negligible use of cash. However, this does not mean that all countries have similar pathways to that ultimate goal. Many places around the world are still reliant on physical money, even in the current context of a global pandemic that is driving digital transactions and e-commerce more than before.
One very good example of a cash-reliant country is Russia. Bloomberg recently reported that Russian citizens withdrew a staggering $13.6bn from ATMs in the last few weeks. This is more than all of the withdrawals made in the entirety of 2019. It seems that Russian consumers still want the familiar safety of having physical money during periods of high uncertainty, as opposed to more digital-oriented countries like Sweden, South Korea, or the UK.
Similarly, cash hoarding has seen a surge in Europe as well, especially in cash-heavy countries like Germany. In Europe, the value of euro banknotes in circulation has seen the largest increase since the 2008 financial crisis.
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