Cash still king for everyday transactions but falling for the under 40 age groups

The use of banknotes has fallen in comparison to electronic and digital payment systems and applications and cards in Portugal, but nevertheless cash continues to dominate, present in half of all financial transactions.

Cash is still king among ordinary people making purchases in the street for small amounts, particularly among the elderly who prefer bank notes and coins to do their shopping, according to the Bank of Portugal.

“Despite the growing trend for digital payments, the number of transactions in ready cash continues to be significant in 2024, especially for amounts under €30. Cash was used at point of sales for 52% of transactions, (59% in 2022), followed by debit and credit cards with 45% (46% in 2022), while mobile applications such as MB Way represented 7% of transactions (4% in 2022)”, states the Bank of Portugal report based also on the results of a study carried out by the European Central Bank on consumer attitudes in the Euro Zone.

According to the same study, the older consumers are, the more likely they are to use cash: 57% of consumers that use notes and coins are generally over 65.

In turn, consumers under 40 tend to pay for their goods and services with cards but the biggest fall was paying with cash via automatic vendor machines (from 74% in 2022 to 55% today).

More than half (55%) of consumers prefer to pay with cards and other digital methods in shops, whereas 22% prefer to pay with cash.

However, 62% of people still think it important to retain the option of paying for goods and services in cash.

“On average, consumers think that cards are faster and easier to use, while paying with bank notes and coins makes it easier to control expenditure and protect the privacy and anonymity of the purchaser.”