Anxiety over war, wildfires and cyber-attacks leads to growth in cash stocks in EU
Value of banknotes in circulation rises from €1bn in 2016 to €1.6bn in 2026 as people advised to keep stash of cash The number of banknotes in circulation in the EU is increasing despite widespread smartphone payments, new data shows, with wildfires ripping through parts of Europe fuelling demand for an emergency stash of cash. While cash plays second fiddle to contactless payments in many cities across Europe, the amount in circulation is actually going up, Philip Lane, the chief economist of the European Central Bank (ECB), said at the MacGill summer school conference in Ireland. The rise of cash has been linked to anxiety over wars and the impact of cyber-attacks on online and contactless payment systems, say experts. “The total stock of banknotes is continuing to grow. In transactions, it [the number of notes] is coming down, but in terms of the stock [it is increasing],” Lane said. Last year Marks & Spencer in the UK suffered a sustained cyber-attack which stopped the retailer taking online orders for weeks.
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In a “use it or lose it” warning, Olive McCarthy, professor at University College Cork with an interest in financial inclusion, said the continued use of cash was vital for society. “While advice to maintain cash for emergencies is well made, and serves to remind us all to be prepared when digital systems let us down, it is essential that cash does not become viewed merely as a backup measure.
