Cash circulation in COVID-19 pandemiс
DOI:
https://doi.org/10.31617/zt.knute.2021(115)07Keywords:
cash, central bank, cash circulation, non-cash payments, pandemic, monetary base, digital currency, electronic payments, legal tender.Abstract
Background. In the context of the COVID-19 pandemic, there was a change in the behavior of central and commercial banks, the population and retail chains in terms of cash growth. These trends create new challenges for the central bank; it requires an analysis of current trends and justification of the feasibility and optimum frames for the scale of cash payments in society.
The aim of the article is to reveal the impact of the COVID-19 pandemic on cash circulation and to analyze the role of the central bank in regulation of this process.
Materials and methods. The theoretical and methodological basis for the research was scientific studies, analytical reviews of central banks around the world, dedicated to identification reasons for both trends in the use of cash – for expansion and curtailing simultaneously – in payments by households in the countries with different levels of economic development and digitalization of society. This study is based on a set of scientific approaches and methods: theoretical summarizing, comparative analysis, sampling and synthesis.
Results. The article contents the identification of reasons for the decrease in cash in various economies during the COVID-19 pandemic, as well as its impact on changing the behavior of banks, regulators, retail chains, and customers of banking services. The measures taken by central banks to manage cash circulation in the context of coronavirus are outlined, with conclusions on current state and prospects of using cash in the countries with different levels of economic development. In addition, this paper offers the suggestion on central bank framework for monitoring usage of cash.
Conclusion. The COVID-19 pandemic has prompted the world’s central banks to take a set of measures: strategic, communication, marketing, and technical. Cash demand does not depend on the level of economic development of the country, but is formed under the influence of individual factors of their citizens. Following the example of central banks in many countries, it seems appropriate for the NBU to facilitate annual survey of the propensity of citizens to use cash, to make a solid background for effective framework for monitoring cash circulation.
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