ECB study: cash remains the most frequently used means of payment; electronic payments growing fast

Cash remains the most frequently used means of payment in the euro area in 2022, but its share of total payments is declining. Conversely the Covid-19 pandemic has accelerated the trend towards electronic payments, according to the latest Study on the payment attitudes of consumers in the euro area. The majority of those taking part in the study cite the ease of using electronic payments as a reason for moving away from cash. Banka Slovenije finds that the share of everyday payments made in cash in Slovenia remains among the highest figures in the euro area.

The ECB today released its third Study on the payment attitudes of consumers in the euro area, following those carried out in 2016 and 2019.

Comparisons reveal a trend of decline in the use of cash, which nevertheless remains the prevailing payment instrument for everyday payments. Consumers used cash for 79% of their point-of-sale and person-to-person retail transactions in 2016 and for 72% of them in 2019, compared with just 59% in 2022.

Figure: Share of payment instruments used at points of sale in the euro area (number of transactions)

Source: Study on the payment attitudes of consumers in the euro area (SPACE II)

The current study also revealed a pronounced trend of increase in electronic payments: the share made by cards rose to 34% (up from 19% in 2016 and 25% in 2019). The share of payments made by mobile app rose to 3% (up from 1% in 2019). Consumers mainly use electronic payments for larger sums.

Despite the trend of declining use, cash is the most important means of payment for 60% of those taking part in the study. They main advantages that they cite are easier management of personal finances, the maintenance of anonymity, and the immediacy of payment, while card payments are seen as quick and simple.

No significant decline in use of cash in Slovenia

The study also showed that there are considerable differences in the payment behaviour and habits of consumers in individual euro area countries. Slovenia remains faithful to cash, which accounts for 73% of payments at bricks-and-mortar points of sale, and is thus one of the countries where this payment instrument is the most commonly used. The share of online payments also rose, to 15% (up from 10% in 2019), where Slovenian consumers mostly use card payments (54%), followed by digital wallets (20%). Similarly to consumers in other euro area countries, card payments are primarily used to make larger purchases.

The full study can be found on the ECB website, and the next study on payment attitudes of consumers in the euro area is expected to be released in 2024.