How COVID-19 Has Accelerated The Move Away From Cash

Financial Services Bulletin

One of the impacts of the COVID-19 pandemic has been a significant decrease in the use of cash for day-to-day transactions. To a large degree, this has been involuntary, as many retailers have stopped accepting cash for health and safety reasons.

It is possible that this is a temporary effect, and that the use of cash will return to pre-pandemic levels once there is no longer the need for social distancing and other measures to mitigate the spread of COVID-19. However, this is an acceleration of a pre-existing trend, and we think it is more likely that it will have lasting effects. In other words, Canadians were already using cash less frequently, and now that consumers and retailers have gotten more accustomed to alternative payment methods such as contactless debit or credit card transactions, they may never go back. This bulletin situates the rise in non-cash payments as a result of COVID-19 in the broader context of payments