Clearly, Cash is Over

Which is why the Finnish central bank has begun to warn its citizens to keep cash on hand.

Say what you will about funny colored pieces of paper, but it just works, all the time: 

In October, 2022, Päivi Heikkinen, the Head of the Payment Systems Department and Chief Cashier at the Bank of Finland, warned that Finland’s payments system could go down for weeks, and urged households to keep enough cash to last them for up to 72 hours in case of payment system disruptions. The irony, as we pointed out at the time, is that Finland, like its Scandinavian peers, is among the world’s most cashless economies, and its central bank, like its counterparts in Norway and Sweden, played more than a bit-part role in making that possible:

According to the Bank of Finland, [Finland] is on track to become completely cashless by 2030. A survey conducted last year by the central bank found that only 7% of people use cash when making purchases. Ninety percent of the survey’s respondents said they pay for their groceries with a card or mobile payment app.

However, Heikkinen says that now is not a good time to give up cash completely, given the rising risk of attacks against Finnish infrastructure, including its payments system:

“More payment methods bring resilience. If a single payment method sometimes does not work, then we have other payment methods at our disposal. Cash still plays a very important role here.”

It seems that more and more central banks in Europe are rediscovering one of the beauties of cash: its resilience. It won’t fail in a power cut or seize up during a cyber attack (although, of course, ATMs might). As Brett Scott, author of Cloudmoney: Cash, Cards, Crypto and the War for our Wallets, notes , any society that runs purely on digital platforms operated by large financial institutions “is going to have major resiliency problems.” 

Indeed.