Debate Over Cash: Would There Really Be Advantages to Abolishing Bank Notes and Coins?

There are always academics in the public debate who argue in favour of abolishing cash. In their view, such a step would remove the de facto minimum interest rate of zero and would thus create further scope for action in terms of monetary policy. In addition, the abolition of cash would also make anonymous transactions and tax evasion more difficult. Are these arguments convincing? In the view of Carl-Ludwig Thiele, Deutsche Bundesbank, cash should remain a method of payment in the future. People value cash as an anonymous method of payment that enables them to protect their private sphere and to exercise their right to self-determine the information that they disclose regarding their expenditure. In the opinion of Dirk Niepelt, Studienzentrum Gerzensee and University of Bern, the abolition of cash would dramatically reduce the private sphere. Malte Krüger, Hochschule Aschaffenburg, and Franz Seitz, Ostbayerische Technische Hochschule Weiden, also feel that the impact of such a measure would be limited if it were only abolished in a currency zone. Robert Halver, Baader Bank, Frankfurt am Main, finds transactions via card payment often complex and long-winded, and sees insufficient data security in the cashless world. Albrecht F. Michler, Heinrich Heine University of Düsseldorf also finds an abolition of cash by government order as unconvincing, given that the costs could exceed the additional benefit and that renouncing cash will not resolve any economic problems.