For years, politics, financial institutions, businesses, and society have been debating the future of cash. Often, the forecasts have not been very rosy. Especially the younger generations are said to be taken with mobile payment options like PayPal or Apple Pay. On the other hand, bills and coins are increasingly disappearing from perceptions in forecasts. A current trend shows: Cash was declared dead too soon in this regard as well.
Is cash on the decline?
Various studies seem to agree: Cash is steadily losing importance in our society. Although the stated at the end of 2022 that cash is still the most common method of payment at the checkout, its share is continuing to decrease in relation to cashless payment methods – from 2019 to 2022, it fell by 9 percentage points. The coronavirus pandemic has also contributed to accelerating this development. Likewise, the recent shift towards cashless alternatives shows
This focus is especially on the younger generations. According to the, over 30 percent of 18- to 29-year-olds surveyed last year could even imagine a completely cashless society – thanks to smart options. It is all the more astonishing that a new trend is now driving young consumers into the arms of cash: Cash Stuffing.
Saving with Cash Stuffing
The hashtag #cashstuffing is currently going viral. Thousands of posts on the topic can be found on Instagram and TikTok. If you freely translate the term, Cash Stuffing means "private cash counting." The idea behind it: To keep an eye on one's finances through physical money and save properly at the end of the month. The trigger for this saving hack was the increased cost of living, particularly the horrendous energy costs. The effect is still noticeable today: Many, especially younger people, are worried about controlling their finances. A solution can currently be found all over social networks.
In Cash Stuffing, you withdraw all the money available for everyday life at the beginning of the month. Rent or money for insurance obviously stays in the account. Then you think of categories, write them on envelopes, and allocate the money accordingly. Various options are possible: from an envelope for groceries to an envelope for entertainment, such as "hobbies," to an envelope for saving. The respective budget should then be sufficient for the entire month. That means you can only pay with the money allocated to the respective envelope. Pinching from another envelope is strictly forbidden.
Trade and Financial Institutions: Reaction Required!
That's one side of the social media trend. On the other side are retailers and financial institutions. They have recently faced increasing challenges with cash concerns. About two years ago, the international monetary association ICA and the Federal Association of German Cash and Value Services (BDGW) warned that cash supply for retailers and banks is becoming expensive – perhaps even too expensive. However, since Germans continue to appreciate their cash and trends like Cash Stuffing show that the younger generation wants to stick with it for now, rapid solutions for efficient cash management are needed.
ALVARA | Digital Solutions has therefore dedicated itself to cash management – with contemporary software solutions. The ALVARA Interactive Cash Control Platform (ICC), for example, is dedicated to the cash cycle. Retailers, cash-in-transit companies (WDL), financial institutions, and the Bundesbank benefit from it. Because with digital cash management, one thing is never lost: oversight. The complex communication and monitoring tasks of the individual stakeholders in regard to cash logistics processes can be easily managed via the ICC platform or the ICC app. How can a single platform be suitable for such different stakeholders? The modular design allows for the solution to be adapted – depending on priorities and tasks.
Conclusion
Cash Stuffing makes it clear: Cash will continue to exist – among young and old alike. Trading companies and financial institutions need to react to this. In order to withstand the increasing cost pressure, they could, for example, rely on software solutions. These optimize cash management through digital and automated processes, which in turn lead to more efficiency, security, and transparency. A trio with which companies and institutions can meet the consumer demand to continue paying with bills and coins in the future.
You can find information about all our products for cash management in retail here.
All solutions for digital cash management in financial institutions can be found at a glance.
Do you want to prepare for the Cash Stuffing trend? We are happy to advise you on suitable solutions – individually tailored to your industry!