More money for less cash

What does abolishing cash achieve?

In Europe, cash is being used less and less. The reason is simple. Eliminating cash saves administrative costs, ensures employee safety and gives companies visibility into transactions, reducing the risk of fraud.

Cash gets more expensive

Processing cash payments costs businesses worldwide at least 2% of their monthly revenue. This is according to the Research Cashless Cities (2017) by Roubini ThoughtLab commissioned by Visa. The study looked at 100 cities worldwide.
Cash transportation is becoming more expensive, as is holding, insuring and depositing cash. But handling and processing administration also takes time and money. In addition, these repetitive operations create unnecessary work in the finance department. So doing away with cash is increasingly popular with organisations.

Amsterdam is ‘Digitally Advanced’

If all the governments, consumers and businesses in the 100 cities in this study decide to ditch cash and switch to debit cards, digital transactions and mobile payments, it will yield a benefit of €399 billion a year.
Amsterdam falls into the ‘Digitally Advanced’ category in the survey. That means the financial infrastructure is good enough to make cashless payments. However, it must be said that in Amsterdam, cash is still in considerable circulation.
Banning cash in Amsterdam would save the city 6.4 billion euros annually. The biggest benefit at €3.1 billion will come from businesses, this study shows. Of course, business spending is part of that.
The report points out that while companies that replace cash with digital payments incur costs in doing so, they are still cheaper. The gain is mainly in cost savings through more efficient administration, leaving time to improve processes and bring in new customers. The 100 cities save 3.1 billion hours of payment processing annually.

Stockholm ahead

We are increasingly seeing the abolition of cash in the Netherlands, making cash obsolete. At festivals, you can already no longer pay with cash. And the GVB in Amsterdam is fast moving towards cashless public transport in the region. The main reason is a series of robberies on trams and persistent delays just before departure.
This trend is strongest in Scandinavia. According to this study, the city of Stockholm, for instance, falls into the Digital Leader category when it comes to adoption of digital payment methods. Unlike Amsterdam, the financial infrastructure for digital payments is used to its full potential. The lion's share of Stockholm pays effortlessly by debit card, mobile or digital. They have to, because in public transport it is impossible to pay with cash. Even sellers of Stockholm's homeless newspaper carry mobile payment devices. Many shops, too, only accept debit cards. Less than 20% of all payments take place in cash. In short, anyone who wants to do anything outside in Stockholm should at least have a debit card.

Abolish cash for business travellers

Business travellers who still carry an old-fashioned envelope of cash as an expense allowance may still be in for a surprise in cities like Stockholm, Copenhagen and Helsinki. Experts by experience still only travel to Scandinavia with debit cards.
In fact, anyone who wants to do business without delay and quickly has a (prepaid) credit card or business debit card in their pocket. At many airports, airlines no longer accept cash when (re)booking a flight. Check-in is now done quickly by mobile phone and purchases on board aircraft are also made via credit card.
It is therefore no wonder that more and more companies are switching to a process where only business (prepaid) credit cards are used. In Belgium, by the way, business travellers can get by with a bag of cash without any problem; cash payments are on the rise there.