Pandemic payment patterns

Nicole Jonker, Carin van der Cruijsen, Michiel Bijlsma and Wilko Bolt

Journal of Banking & Finance, 2022, vol. 143, issue C

Abstract: COVID-19 has temporarily changed the relative costs and benefits of different payment methods: cash has become more costly in terms of health risks, ease of use and likelihood of acceptance, whereas debit card usage has become less costly. As a result, consumers have shifted away from cash. Based on unique daily payment diary survey data collected between January 2018 and December 2021 amongst a representative panel of Dutch consumers, we study the shift in payment behaviour and payment preferences during two lockdown periods in the Netherlands in 2020 and 2021. Since the start of the first lockdown the likelihood of debit card usage at the expense of cash has increased by 12 percentage points compared to its trend level. About 60 percent of this shift on top of the autonomous trend persisted several months after the end of the first lockdown and part of it has persisted several months after the end of the second lockdown. The results indicate that the pandemic accelerated the increased usage of debit card at the POS, especially during the first pandemic year. Also, the pandemic has resulted in a shift in payment preferences towards more contactless payments. Both effects are largest for elderly people.

Keywords: COVID-19; Consumer payment behaviour; Consumption; Payment diary data (search for similar items in EconPapers)
JEL-codes: D12 E21 E42 O33 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Working Paper: Pandemic payment patterns (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:143:y:2022:i:c:s0378426622001893

DOI: 10.1016/j.jbankfin.2022.106593

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