Published in Handelsblatt, Germany
Study – Cash brings more to the economy than it costs
A team of researchers has found that the costs associated with cash are significantly lower than its economic benefits. Two factors in particular contribute to this finding.
Munich. Opinions are divided on cash: Some see coins and banknotes as symbols of freedom, while others see them as relics of a bygone era that also help criminals conceal their crimes. Furthermore, critics of cash point to the high costs, which in Germany alone amount to 0.45 percent of the gross domestic product (GDP). This means that around 20 billion euros are spent in Germany so that the question “Cash or card?” can still be asked at the checkout. The revenues of the Bundesbank and the European Central Bank from cash transactions amount to less than half of these costs.
At the same time, it is unclear what value cash creates. Julia Pitters, a trend researcher and financial psychologist at the International University of Vienna, was surprised that there is so little research on this topic. Together with economist Franz Seitz from the OTH Amberg-Weiden, Frane Maroevic from the International Cash Association (ICA), payment expert Andreas von Loeper, and an interdisciplinary research team from German-speaking countries, she has attempted to determine the value of cash.
But how did the scientists calculate this, and what benefits can cash actually have?
