Date Published: 22/07/2020
ARCHIVED - Cash is no longer King in Spain; cards are winning the fight for your money
ARCHIVED ARTICLE Before the Covid crisis, cash was used in six out of ten transactions, now it’s only 45% compared to 54% of 'plastic use'
Consultancy company Nielsen has produced an interesting report which highlights changing shopping habits, but also the fear associated with contracting Covid through everyday actions.
Social media users from the UK have been asking quite frequently recently about whether “cash is still accepted in Spain” and whether they should even bother changing any money for a forthcoming holiday; some are quite surprised that cash is even used here at all!
But the world is changing as are shopping habits.
The report says that the pandemic is accelerating the “emergence of online” in the consumer market, but it has also led to a change in the means of payment to pay for shopping.
Before the health crisis, cash was used to pay on 61.2% of occasions, but now represents only 45.5% of purchases; 'plastic' on the other hand, has gone from 38.5% to 54.1%.
This change in trend responds to the effects caused by the pandemic on the consumer and their habits during the state of emergency; one of the most important being the drop in the number of visits made to a shop for food (-13%) and the increase in the amount spent on each visit ( + 20%), so shoppers shopped less frequently but bought more on each visit.
Health recommendations made by many regional governments asked shopprs not to use cash, but to pay with cards instead, and visits to ATM machines also dropped substantially as well, the result being that two out of every three euros spent on making the purchase required a PIN and only one out of three required the opening of a purse!
This paradigm shift, the consultant points out, is also very much in line with the rise of e-commerce, which, due to its characteristics, requires digital and non-physical payments, deepening the decline in banknotes and coins in pockets.
Elderly getting used to a plastic world
Due simply to the rapid tansformation of the modern world in the past 10 years, most people accustomed to using payment cards are under 50, and cash tends to be used more by the over 65s, however, the health crisis has also pushed greater numbers of the elderly population to embrace using cards the result of which is that the use of cards by the over 65s has increased by 13 points during the crisis.
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