Cash withdrawals drop by nearly 50 percent amidst coronavirus restrictions

Иллюстративное фото: Филип Яндоурек, Чешское радио

The coronavirus outbreak is forcing Czech consumers to change their shopping habits, the daily e15 reported on Tuesday. The number of cash withdrawals from ATM machines dropped by nearly 50 percent since the government declared a state of emergency in mid-March. At the same time, Czech banks have reported a steep increase in electronic payments.

Photo: Filip Jandourek / Czech Radio
According to one the country’s biggest banks, ČSOB, the number of weekly cash withdrawals from ATMs dropped by 47 percent in April compared to the period before the state of emergency was declared.

Banks are also reporting a drop in the amount of money withdrawn. For example Česká Spořitelna saw a 44-percent drop in the amounts withdrawn. While in the period preceding the state of emergency, Czechs withdrew some CZK 6.3 billion a week, during the first week of April it was only CZK 3.5 billion.

At the same time, people have started using electronic banking much more. "Since the state of emergency was announced and the operation of brick-and-mortar stores restricted, the number of card payments over the internet have increased by 14 percent," the spokesman for Komerční banka, Michal Teubner, told the daily e15.

ČSOB has recorded the biggest surge in electronic transactions in history.

"The numbers clearly show in which direction our clients are going. The pandemic has just speeded up the trend of electronic payments," says Jan Sadil, member of CSOB banking board, responsible for retail.

Marcel Gajdoš, Visa Europe's regional manager for the Czech Republic and Slovakia, also confirms this trend.

"The share of internet payments in the overall volume of cash-free payments has doubled. This is mainly due to the drop in the number of card payments in stores," he told the daily.

It is hard to say whether this trend will last after the safety measures related to the coronavirus outbreak are relaxed, says Roman Kotlán, chairman of the Czech Bank Card Association.

"Banks, which have lagged behind in digitalisation, are now catching up. They see that people resort to internet payments and payments through apps when there is no other choice.“

He also says that while the young generation was used to digital payments, middle-aged clients, who have been rather conservative, are gradually getting used to it as well.

"Cash as such will still be used in the future. The current figures might be distorted by the fact that some stores currently refuse to accept cash payments for hygiene reasons," Kotlán told e15.