A few weeks ago, Norway's largest bank, DNB, made a statement that it would like to see an end to cash. This follows a decision last year by Norway's second bank, Nordea, to stop handling cash in their branch offices.
The End of Cash for Norway?
According to the bank's director of retail banking, Trond Bentestuen, there is approximately 50 billion kroner in circulation and the country's central bank, Norges Bank, can only account for 40 per cent of its use. That means that 60 percent of money usage is outside of any control.
The bank believes that this is due to under-the-table money and laundering. Because there are so many dangers and disadvantages associated with cash, the bank has concluded that it should be phased out. (source)
Cash Still Matters, Says Norges Bank
The statement received much criticism, and Norges Bank issued its own statement that the age of cash usage is far from over (source in Norwegian). It stated that there is still great demand for cash - and that circulation has remained stable for the last ten years.
It makes the point that while the bank knows how much cash is circulation, it is difficult to know how these funds are located or used, and any conclusions are contradictory. It is nonetheless clear that cash still represents a high proportion of total spending.
What Does This Tell Us
The claims and misconceptions in Norway are illustrative of a continuing debate in a number of advanced economies.
So it is timely that we will be inviting representatives from Norges Bank and De Nederlandsche Bank (the Dutch central bank) to speak on these topics at The Future of Cash in April.
In our session on The Evolution of Cash Cycle Models, we will hear from Leif Veggum, Assistant Director, Chief Cashier's Department at Norges Bank, who will speak about the impact of the reduction of commercial banks' footprint on the Norwegian cash cycle.
Then, from De Nederlandsche Bank, we have two presentations.
In our session on The Evolution of Cash Demand senior advisor Bram Scholten, will analyse how the Netherlands are planning to deal with the declining use of cash and how this compares with the approach in the Nordic countries.
Then, in our session on Solutions for the Collection of Cash policy advisors, Nicole Engel and Esther van den Kommer, will share the results of a survey conducted in the Netherlands in 2014 about the attitudes of Dutch retailers towards cash. They will ask 'how much longer will cash be around?' and 'does the central bank need to change any of its policy with respect to cash?"
Hear the Debate for Yourself
Such themes could have a big impact on strategies for cash handling, affecting central banks, retail banks and suppliers alike.
What is lacking is a rigorous assessment of the benefits and drawbacks of cash - and that is what we hope to provide at The Future of Cash in Paris in April.
Read the full programme
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