War on cash: Italy believes in cashless' fake miracles

The coronavirus pandemic has left Italy’s economy in a bad state, with the latest predictions foreseeing a -9% in GDP in 2020. At the same time, the online economy has limited the fall, leading to a +15% in the use of contactless payments and +80% of mobile payments compared to 2019. For the first time, Italy’s historic resistance to electronic transactions might be at a turning point. This is one of the reasons behind the country’s government decision to draft a plan in the direction of a ‘cashless society’, which is also meant to counter undeclared economic activity and tax evasion - a phenomenon that in Italy is worth 12% of the country’s GDP.

Even before the pandemic, Italy was not in good shape: it is at the 24th place out of 27 countries in the EU for number of digital payments, while about 80% of all transactions are still made in cash. Now, COVID-19 has provided a big push in the direction of an enhanced use of electronic money, also because it allows no contact with objects (currently for payments up to €25 ($29) there is no need to insert a pin code) and is therefore perceived as safer.

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The cashless society from an ethical point of view

The debate about the move towards a cashless society has been at the center of the scene for several years, now. Various angles have been taken by economists, politicians, banking institutions and sociologists. Beyond the technicalities of the debate, lies the question of freedom, of inter-citizen solidarity and of governmental responsibility. The debate cannot remain in the hands of financial specialists, it is first and foremost an ethical, political and societal issue.

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