The EPC's Norbert Bielefeld analyses the changing behaviour of the European 'payment citizen' in the digital world. In line with stated policy objectives, he advocates an alternative approach: a SEPA legal tender model spanning both cash and electronic payments.
Although cash is still the predominant payment method in Europe, latest data indicates a trend towards increased use of non-cash, account-based payment instruments. The legal electronic tender is on the march, powered by popular acceptance rather than legislative mandate or administrative fiat, which in itself is a very positive message. It can be assumed that this trend will become common market practice with ‘digital natives’, who have never known anything other than internet and the mobile phone, coming of ‘paying age’.
Policies governing the issuance and re-circulation of euro banknotes and cash must be aligned with the requirements of the digital market. This opportunity has been missed with the roll out of the second series of euro bank notes launched in 2013.
In order to avoid an unacceptable societal paradigm, preparations for the third series of euro banknotes should begin now. This next generation must move away from the physical form factor.
The author reiterates his invitation to European Union policy-makers to dare to be bold: a SEPA legal tender model spanning both cash and electronic payments is an option.
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