The Bank for International Settlements released a bulletin entitled, Covid-19, cash, and the future of payments, which addresses growing public concerns and questions about the possibility of transmitting viruses through cash. The Covid-19 pandemic has understandably catalyzed apprehension surrounding issues of hygiene, safety and transmission of the virus; and it logically follows that the public will have concerns about the physical use of cash. BIS’ bulletin establishes from the onset that its key takeaways are the following:
- “The Covid-19 pandemic has fanned public concerns that the coronavirus could be transmitted by cash.
- Scientific evidence suggests that the probability of transmission via banknotes is low when compared with other frequently-touched objects, such as credit card terminals or PIN pads.
- To bolster trust in cash, central banks are actively communicating, urging continued acceptance of cash and, in some instances, sterilising or quarantining banknotes. Some encourage contactless payments.
- Looking ahead, developments could speed up the shift toward digital payments. This could open a divide in access to payments instruments, which could negatively impact unbanked and older consumers. The pandemic may amplify calls to defend the role of cash – but also calls for central bank digital currencies.”
The BIS bulletin further reports the increase of media inquiries and internet searches regarding the safety of handling cash, with countries such as Australia, France, Singapore, Switzerland, Ireland, the United Kingdom, Canada, the United States, Jamaica and Kenya leading with the highest number of searches on this topic as of the publication of this bulletin on April 3, 2020. The bulletin concludes by placing emphasis on the value of central bank digital currencies (CBDCs), but with the caveat that they must be accessible to the underbanked with contact-free technical surfaces appropriate for the entire population. “The pandemic may hence put calls for CBDCs into sharper focus, highlighting the value of having access to diverse means of payments, and the need for any means of payments to be resilient against a broad range of threats.”
WOCCU will continue to follow finance and financial regulatory issues surrounding the Covid-19 pandemic as they develop.