Revealed: Europe’s Young Prefer to Pay in Cash

For decades, forecasts pointed towards a cashless future. Yet the data tell a different story. At the end of 2024, euro banknotes in circulation reached €1.59 trillion — equal to about 10% of euro area GDP, the same share as a decade ago.

And even as digital payments expand, cash accounted for roughly half of all point-of-sale transactions in 2024, keeping it the most frequently used and most widely accepted form of payment across the euro area.

This podcast examines one of the most striking findings from the ECB’s May 2025 Economic Bulletin: the role of younger generations in sustaining cash use. Far from abandoning physical money, people in their 20s and early 30s continue to draw on it across all three functions identified in the report — as a means of payment, as a store of value, and as a safeguard option when other methods fail. Survey evidence shows that younger cohorts consistently hold cash “just in case,” linking it to autonomy and control over spending.

In seven minutes, we unpack why forecasts underestimated these trends, how digitalisation intersects with age and cohort effects, and what it means for the future of payments in Europe. The resilience of cash is not incidental — it is built into the everyday decisions of millions, including those who were expected to leave it behind first.

Source: European Central Bank report — Cash is alive… and somewhat young? Decoupling age, period and cohort from euro cash use, prepared by Rebecca Clipal and Alejandro Zamora-Pérez; published in the ECB Economic Bulletin, Issue 5/2025

Note: This podcast was developed using Google’s NotebookLM platform