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Even though central banks all over the world are encouraging the creation of Central Bank Digital Currencies (CBDCs), most customers still prefer cash payments. According to a recent Deutsche Bank survey, people still prefer using cash and debit or credit cards over other traditional payment options.
5,9% of respondents to the survey, which had 4,850 participants from the US, UK, and Europe, said they thought currency would always have a place in the economy. Plus, 44% of respondents said they would rather use cash than CBDCs, and only 16% thought digital currencies will become a commonplace alternative in the future.
Deutsche Bank analysts Marion Laboure and Sai Ravindran pointed out, “While 59% of consumers believe that cash will always be relevant, the COVID-19 pandemic accelerated the shift toward digital payments, particularly among Gen Z.”
Privacy concerns also affect perceptions of CBDCs, particularly in the United States where a large number of users favor private cryptocurrencies like Bitcoin over those supported by the government. According to the survey, 21% of participants preferred cryptocurrencies because they thought they offered more anonymity.
European customers, on the other hand, demonstrated a clear preference for cash and valued its secrecy. This tendency was also noted in a Bank of Canada research, which stated that 92% of Canadians preferred cash to a digital Canadian dollar (CAD) and that 86% of Canadians opposed CBDCs.
While central banks are still investigating applications for wholesale CBDCs, consumer mistrust and privacy issues continue to be major obstacles to their wider implementation.