Between Cash Supply and Cashback: How Retailers Can Think About Cash Management More Efficiently

Around 2,060 test purchases conducted as part of a Bundesbank study across retail, hospitality and service providers show that cash is still accepted by 99.4 percent of respondents. For many retailers, however, handling cash is becoming increasingly complex as the underlying conditions continue to deteriorate. Those who want to continue offering cash as a customer-friendly payment option need new processes, greater transparency and solutions that enable the efficient management of cash supply, payout and disposal.

Bank Branch Closures and Their Impact

The number of bank branches has been declining since the 1990s. What has made headlines in recent years is therefore not an entirely new phenomenon. However, increasing digitalization, changing customer behavior and cost pressures resulting from the prolonged low-interest-rate environment have accelerated this trend even further.

This creates challenges not only for banks themselves, which face customer migration and declining revenues. For retailers, the consequences are primarily practical: cash still needs to be counted, stored, transported and ordered. Where banking infrastructure is no longer readily available, reliable cash-in-transit providers and resilient operational processes become essential. This is no longer a strategic consideration – it is an operational necessity.

Cashback as an Additional Service Offering

This development has created a second challenge: retailers are increasingly taking on an additional role in cash supply for consumers. More and more retailers offer cashback services, providing not only goods but also direct access to cash. Customers are making active use of this service. 

This reflects a structural shift in how cash is used: while consumers are paying less frequently with cash, they are increasingly withdrawing banknotes directly at the point of sale. The EHI study "Payment Systems in Retail 2025" reports rising cashback volumes, growing from EUR 12.31 billion to EUR 13.57 billion. 

Retailers have limited room to influence this trend. Cashback is often a customer-driven service whose costs and operational implications cannot be controlled at will. However, there is one key lever retailers can adjust.

The Solution: Efficient Cash Processes

Bank branch closures and cashback cannot simply be “resolved.” Both developments increase pressure on retail cash processes from different directions. What they require is an optimized economic and organizational approach to cash management. Retailers that take an integrated view of cash supply, payout and disposal can plan holdings more precisely, reduce reconciliation efforts and organize processes more cost-effectively. The following aspects are particularly relevant.

Intelligently Balancing Cash Holdings

How much change is currently available? How much is actually needed? How much liquidity is tied up in banknotes? Only when these questions are answered can retailers systematically analyze and optimize cash holdings and flows. It is essential not to treat all stores equally. Differences between locations must be identified, considered and managed individually.

Reassessing Economic Efficiency

The key is to structure processes in a way that relieves store operations, reduces unnecessary effort and ensures that service offerings remain economically viable.

Ensuring Future Readiness

As traditional banking structures continue to disappear, alternative solutions and specialized partners are becoming increasingly important. Retailers should therefore actively seek partnerships and operating models that simplify processes and increase transparency.

Digital Cash Management as the Goal

Digital processes can support all of these areas. Software solutions help manage cash holdings in the back office, automate change orders and streamline disposal processes. This helps avoid shortages, reduce excess holdings and create greater transparency across overall cash flows. At the same time, the focus must not be limited to individual cash registers or safe balances. The entire process chain – from POS to vault, cash logistics and financial accounting – must be considered as one integrated system. Automated workflows, real-time data and seamless traceability combined with automatic posting create the foundation for this.

When evaluating reliable solutions, retailers should look for the following features:

• Digital control of the entire cash process chain
• Real-time transparency across holdings and cash movements
• Track & trace for all cash transports and liability transfers
• Transparent analysis of deviations and disruptions
• Flexible integration into existing systems and processes
• Connectivity for all stakeholders via one central platform
• Optimized cash and change supply for stores

Taking Control of the Challenges

Cash management is no longer merely an operational side issue. It directly affects customer service, store processes, cost structures and regional cash availability. Precisely because physical cash logistics will remain necessary in the future, effective end-to-end process control is essential. Retailers that create transparency, intelligently balance cash holdings and combine digital support with operational practice can manage current challenges more effectively and establish more efficient cash processes.

Would you like to reduce the operational burden of cash supply for your stores? Together, we can lay the foundation.