Bundesbank: How cash will be used in the future

In a recent study, the Deutsche Bundesbank examines the question of how cash will be used in the future. The study outlines three different scenarios for paying with cash in 2037. These scenarios are not forecasts, they are possible visions of the future. “We wanted to get an idea of the social and economic environment in which cash will be embedded in the future in order to derive options for action,” explained Burkhard Balz, member of the Bundesbank’s Executive Board. “The future scenarios should help to ensure that the right course is set so that cash remains an attractive, generally available and accepted means of payment and store of value in the future,” added Balz. The Bundesbank has the legal mandate to provide sufficient high-quality euro cash in Germany at all times.

The scenario “The hyper-digital payment world” describes a very digitalised world in which cash has almost disappeared from most people’s everyday lives, there are only a few bank branches or ATMs left and it is no longer possible to withdraw money at the checkout, as it is hardly possible to pay cash in shops. The scenario “The payment world in the cash renaissance” describes a partial return to cash and its advantages. In this scenario, the use of cash initially declines, but stabilises in the 2030s. The scenario “The disappearing hybrid payment world” reflects an environment in which the use of cash is very much dependent on people’s living conditions. In retail, customers are encouraged to make cashless payments. Access to cash is constantly deteriorating and the use of cash is creeping out. 

“In no future scenario will cash disappear completely,” explained Burkhard Balz. However, in two out of three payment worlds, access to cash and acceptance would not be fully guaranteed. This would practically eliminate freedom of choice and jeopardise the stabilising function of cash in times of crisis.

The study commissioned by the Bundesbank was conducted by the service provider VDI/VDE Innovation + Technik and the Sinus opinion research institute between February 2022 and November 2023. Based on interviews with scientists, cash stakeholders, central banks and social organisations as well as a comprehensive literature review and a representative online survey, it identifies a number of key factors that could influence the future development of cash. Key factors include, for example, the general acceptance of cash in retail or public transport, access to cash, for example via ATMs or at the checkout, consumer requirements for payment methods and the spread of various non-cash payment methods. 

“The study shows that the preservation and widespread use of cash is not a foregone conclusion,” said Bundesbank board member Balz. “In the representative survey, 93 per cent of respondents stated that they would still like to decide for themselves whether to pay in cash or non-cash in the future.” All players in the cash cycle and politicians must act to fulfil this desire for freedom of choice in payment transactions, explained Balz. 

In order to meet these challenges, the Bundesbank would like to strengthen cooperation with cash stakeholders and dialogue with civil society. In order to continue to fulfil its statutory mandate and safeguard cash as a core physical product, the Bundesbank will invest in its efficient and future-proof branch network and continue its analyses of cash.