EconPapers    
Economics at your fingertips  
 

Explaining cash usage in the Netherlands: the effect of electronic payment instruments

Nicole Jonker and Thijs Kettenis

DNB Working Papers from Netherlands Central Bank, Research Department

Abstract: Since the mid-nineties, usage of the debit card by Dutch consumers has increased considerably. While accounting for three quarters of the total value of retail sales in the early nineties, in 2004 the value share of cash payments had fallen to about two quarters. If the cash to payment card ratio in 2004 had been the same as in 1990, the social costs of retail payments would have come out almost EUR 200 million higher. Consumers will have benefited from these savings through lower consumer prices and bank fees. Estimates indicate that the share of cash (in value terms) will decline further from 46% to about 20% in 2015. Changes in the payment infrastructure can yield even higher cost savings. This appears from the outcomes of fictitious scenarios in which the use of electronic means of payment is promoted by increasing the growth rate of the number of EFTPOS terminals and keeping the number of ATMs at their end-2004 level. The outcome in question is indicative of the effectiveness of any efficiency-enhancing measures that may betaken within the scope of the November 2005 Payment Covenant between banks and retailers. An increase in the number of EFTPOS terminals turns out to be especially effective.

Keywords: cash usage; retail payments; cost efficiency (search for similar items in EconPapers)
JEL-codes: E41 E50 H21 (search for similar items in EconPapers)
Date: 2007-04
New Economics Papers: this item is included in nep-com and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10) Track citations by RSS feed

Downloads: (external link)
https://www.dnb.nl/binaries/Working%20Paper%20136-2007_tcm46-146793.pdf (application/pdf)

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:dnb:dnbwpp:136

Access Statistics for this paper

More papers in DNB Working Papers from Netherlands Central Bank, Research Department Contact information at EDIRC.
Bibliographic data for series maintained by Richard Heuver ().

 
Page updated 2020-02-19
Handle: RePEc:dnb:dnbwpp:136