Globally, as several central banks actively explore central bank digital currencies (CBDCs), it is widely expected that the use of cash will gradually decrease.
However, the results of a survey conducted by Deutsche Bank revealed a different trend. The survey covered 4,850 respondents from Europe, the United Kingdom, and the United States, and the results showed that most respondents still prefer to use traditional payment methods such as cash, debit cards, or credit cards rather than turning to CBDC.
Cash comes first, but consumers still have reservations about CBDC
In the survey of 4,850 respondents in Europe, the UK and the US, 59% of respondents firmly believe that cash will always be useful, while 44% said they prefer to use cash rather than CBDC for payments. Only 16% of respondents expect CBDC to become a mainstream payment method.
The data reflects that despite the growing trend towards digital payments, the convenience and universal acceptance of cash still make it the preferred choice for many people.
At the same time, Deutsche Bank analysts Marion Laboure and Sai Ravindran pointed out in the report that although 59% of consumers believe that cash is indispensable, the COVID-19 pandemic has actually accelerated people's shift to digital payments, especially among the younger generation (Generation Z). This trend shows that although the promotion of CBDC may face challenges, the overall trend of digital payments is still continuing to develop.
In addition, the survey also revealed consumers’ privacy concerns about CBDCs. However, about 31% of respondents said they would rather use a government-managed cryptocurrency than one backed by a private institution.
Consumers still have privacy concerns about CBDCs
Among those who participated in the survey, especially those in the United States, a considerable number of people believe that traditional cryptocurrencies, such as Bitcoin, provide better privacy protection than government-backed digital currencies. This view was shared by about 21% of the respondents, who said they prefer to use private cryptocurrencies such as Bitcoin.
Meanwhile, cash was more popular among European respondents due to its anonymity, suggesting that the need to protect the privacy of personal transactions may be stronger in Europe than among respondents in the United States and the United Kingdom.
Although many central banks around the world are stepping up their exploration of CBDC in the wholesale sector, public skepticism about CBDC remains the main obstacle to its becoming a mainstream payment method.
This was further confirmed by a report from the Bank of Canada, which stated that 86% of Canadians are opposed to CBDC, while a whopping 92% would prefer to use cash rather than a digital Canadian dollar (CAD). These data highlight that addressing consumer concerns about privacy and security is critical in the process of advancing CBDC.
Conclusion:
Deutsche Bank’s latest survey results reveal the public’s concerns about the privacy and security of CBDCs, as well as trust in traditional cash payment methods. This finding emphasizes the importance of taking consumer needs and expectations for privacy protection into account in the promotion of digital currencies.
At the same time, it also reminds policymakers and financial institutions to pay more attention to user-friendliness, transparency and security when designing and implementing CBDC to ensure public acceptance and trust.
In short, the success of CBDC will depend on whether it can provide truly valuable services while protecting user privacy and security, which is a process that requires long-term efforts and exploration.
