The Importance of Cash and a SWOT analysis of the Limits on Cash Payments

Apanel Adrian Paweł ()
Additional contact information
Apanel Adrian Paweł: Institute of Finance, Faculty of Economics and Sociology, University of Lodz, Poland

Economic and Regional Studies / Studia Ekonomiczne i Regionalne, 2025, vol. 18, issue 2, 206-219

Abstract: Subject and purpose of the study The subject of the study was the characteristics of cash payments, their role in the payment system and the changing preferences of consumers toward cash and non-cash transactions. The purpose of the research was to gain knowledge about the importance of cash payments in everyday transactions, to assess their advantages and disadvantages compared to non-cash payments, and the effects of cash payment limits on the economy and society. The following research hypothesis was formulated: cash payments, despite the growing popularity of non-cash transactions, still play an important role in everyday transactions, and the introduction of cash payment limits, while it may contribute to increasing financial transparency and reducing the shadow economy, comes with challenges, such as digital exclusion and limiting consumers’ freedom of choice. Materials and methods Statistical data mainly from reports of the National Bank of Poland and the European Central Bank on cash and non-cash transactions in Poland and the European Union were analyzed. A SWOT analysis was used to assess the consequences of introducing cash payment limits. A literature study was also conducted and the results of an empirical study by the NBP, based on diaries recording consumers’ daily transactions, were presented. Results The results of the study showed that despite the growing popularity of non-cash transactions, cash payments remain an important part of the payment system, especially in low-value transactions. Seasonal changes in the number of cash transactions are associated with the holiday and Christmas seasons. Cash is characterized by high accessibility, immediacy and anonymity, which is valued by consumers. Conclusions Limits on cash payments contribute to improving financial transparency and reducing the risk of financial crime and the shadow economy, among other things, but they also come with challenges, such as digital exclusion and potential data privacy issues. Decisions on the introduction of limits should take into account both potential benefits and risks to ensure the sustainability of the payment system. The proposed SWOT analysis is a versatile tool that can support various actors in evaluating and optimizing financial policies at different levels, both nationally and internationally.

Keywords: Cash Payments; Cash Payment Limits; Shadow Economy; SWOT Analysis (search for similar items in EconPapers)
JEL-codes: E42 G21 G28 O17 (search for similar items in EconPapers)
Date: 2025
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.2478/ers-2025-0017 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:vrs:ecoreg:v:18:y:2025:i:2:p:206-219:n:1007

DOI: 10.2478/ers-2025-0017

Access Statistics for this article

Economic and Regional Studies / Studia Ekonomiczne i Regionalne is currently edited by Mieczysław Adamowicz

More articles in Economic and Regional Studies / Studia Ekonomiczne i Regionalne from Sciendo
Bibliographic data for series maintained by Peter Golla ().