Bank of Latvia’s Report Revealed Changes in Consumer Payment Habits Post COVID-19by Fintechnews Baltic October 2, 2020
The September edition of the “Payment Radar” by the Bank of Latvia revealed that the COVID-19 and related restrictive measures significantly affected payment habits in Latvia over this year.
The central bank’s report found that the total volume of non-cash payments edged down for the first time. At the same time, the share of non-cash payments in the total volume of payments is gradually increasing.
The “Payment Radar”, published semi-annually, contains the latest information on money usage habits of Latvia’s households, businesses and the public at large. Development of the proportion and interaction between non-cash and cash payments (as at August 2020) is the central measurement of the overview supplemented by more detailed numerical information and experts’ commentaries.
Key findings of the report
– The share of non-cash payments in the total volume of payments is gradually picking up; the proportion of cash and non-cash payments made by one inhabitant of Latvia constitutes 32% and 68% respectively (in February 2020 – 36% and 64% respectively);
– Both the popularity of instant payments and the use of instant links have followed an upward path; 20% of instant payment users made instant payments by indicating the payee’s mobile phone number only in August 2020 (11% in February 2020), but 46% of the population knew about this service (30% in February 2020).
– The number of registered instant links has exceeded 235 thousand, and this service has been provided not only to the leading banks of Latvia but also to Estonian commercial banks via Bank of Latvia’s infrastructure.
– The number of people who take the view that low denomination coins – 1 cent and 2 cents – should be withdrawn from circulation has risen (43% of the surveyed population expressed such a view in August 2020 vis-à-vis 27% in February 2020); the number of people who believe that 1 cent and 2 cent coins should remain in circulation is still stable (49% in August and 46% in February).
– The population is overall satisfied with the availability of cash (84% of those surveyed); however, a relatively high proportion (8%) of the respondents were somewhat dissatisfied or very dissatisfied with the opportunities to withdraw cash from their current accounts.
The report employs the results of the population survey carried out by a market and social research agency SIA “LATVIJAS FAKTI” in August 2020. Extensive commentary from experts can be found here.
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