Cash Secures Future as Lawmakers Prioritize Inclusive Payment Methods


The recent move by Norway to enact rules ensuring consumers’ ability to pay with cash reflects a growing concern over the potential exclusion of certain segments of the population who are reluctant to use digital payments.

The proposed measures will enable customers to pay with cash at any sales location where other types of payment are accepted, ensuring they are prepared for emergencies, PYMNTS reported earlier this month, per Bloomberg.

This development follows a statement by Norway’s central bank in May, indicating that although only 3% of consumers in the country utilized cash for their most recent in-store transactions, there has been a notable surge in cash withdrawals from ATMs and retail outlets.

Similar protective measures aimed at preserving cash transactions have also been proposed in neighboring Sweden.

In November of last year, it was reported that Sweden’s central bank had called for urgent reinforcement of cash following a government-led investigation into the state’s involvement in the payment market.

The findings of the inquiry underscored that while access to new payment services has simplified life for many consumers, “digitalisation has excluded large groups of people, [particularly] the elderly, people with disabilities, and those with legal representatives.”

In light of these concerns, the report emphasized the necessity for the state to “assume a greater responsibility” in fostering a more inclusive payment landscape by cultivating a balanced payment ecosystem that caters to the needs of both digital and cash-dependent transactions.

Prior to that in 2018, Swedish legislators attempted to curb the country’s rapid transition toward a cashless society by mandating that the largest banks provide cash withdrawal services and manage daily transactions.

At the time, a parliamentary committee said that “the continued development of access to cash in society needs to take place in a controlled manner so that the public’s and society’s need for cash is fulfilled.”

In other parts of Europe, the Swiss National Bank (SNB) stated in February that despite the popularity of payment apps, physical cash will never disappear from use in Switzerland. “Cash acceptance continues to be high and has changed little since 2021,” a survey released by the SNB noted.

The Netherlands has also been exploring public funding for cash supply, Gijs Boudewijn, general manager at the Dutch Payments Association (DPA), told PYMNTS in a 2022 interview.

At the time, Boudewijn said that the DPA was engaging with key stakeholders to ensure that cash remains “available for those who really, really need it whilst at the same time minimizing the cost of the remaining cash infrastructure.”

Cash Is Still King in the US

Meanwhile in the United States, the stance on cash remains resilient, as evidenced by recent remarks made by Lisa Perlini, the Boston Fed’s vice president of Cash Services.

Cash has “stood the test of time because it’s essentially untraceable, it’s easy to carry, it’s widely accepted, and it’s very reliable,” Perlini said. “For example, if the power goes out, and you can’t swipe your card, you can’t purchase whatever is there that you need. So, cash is really important in that situation.”

Perlini also pointed to other characteristics of cash, such as the instant settlement of transactions and the complete anonymity it offers, as attributes that cannot be easily replicated by digital payments.

Overall, although the pandemic paved the way for the anticipated decline of cash, it may have also shown that cash usage, despite being considerably lower compared to previous levels, remains resilient, according to Shaun O’Brien, co-author of the Federal Reserve’s 2023 Diary of Consumer Payment Choice.

In a conversation with the Boston Federal Reserve, O’Brien said, “The environmental factors were almost completely there for cash to go away, and it didn’t.” As a result, they concluded that “people who are using cash just really want to use it, or they really need to use it.”

Looking ahead, the future of cash and how it co-exists with digital payments will likely be shaped by evolving consumer preferences, technological advancements and regulatory interventions.

Ultimately, as society advances toward a predominantly cashless future, the challenge will be to strike a balance that preserves the accessibility and benefits of cash while leveraging the potential of digital innovations.