As a euro area central bank, the Bank of Finland is responsible for the issuance and fitness of cash in circulation in Finland. As a wholesaler, the Bank also seeks to ensure the distribution of cash and the acceptance of cash for retail payments and other uses.

The Bank of Finland monitors actively the use of cash and contributes to ensuring the competitiveness of cash as a method of payment.

Cash ATM network remained unchanged

The COVID-19  pandemic began in March 2020, and authorities at the time urged consumers to avoid cash payments and use contactless payments instead. Cash withdrawals from ATMs and the use of cash in retail payments decreased rapidly in late spring.

The cash ATM network, however, remained virtually unchanged in 2020. The operators did not want to make big changes in the network, reflecting the high uncertainty as to the duration of the crisis.

Following the introduction of strict restrictions on movement in March as a result of the pandemic, consumers initially withdrew extra amounts of cash just in case. The subsequent request by e.g. retailers to avoid cash payments also reduced banknote and coin orders from the Bank of Finland in late spring.

The decrease in COVID-19 cases and the easing of restrictions during the holiday season in July–August increased the use of cash slightly, and cash orders.

Banknote returns are generally a good reflection of the use of cash. They increased only slightly in 2020. In late 2020, they were actually notably smaller than in previous years (Chart 14).

The strong increase in the use of cash before Christmas is usually reflected in banknote orders. The pandemic re-escalated in November and December and, as a result, this seasonal fluctuation was in 2020 much more subdued than in previous years.

In October 2020, the Bank of Finland conducted a consumer survey on the use of cash. The results show, for example, that consumers who usually use cash and cards equally for payment purposes began to prefer card payments during the COVID-19 crisis. In contrast, consumers who tend to use mainly cash continued to favour cash payments (Chart 15).

According to consumers, cash availability has remained good

According to consumers, the availability of cash remained good in 2020.

Orders of cash from the Bank of Finland, distribution of cash to the public via various distribution channels and the use of cash in payments decreased particularly during the pandemic's community transmission phases in spring and late autumn.

The number of bank branches providing cash services continued to decrease steadily, and in addition during the COVID-19 community transmission phases, banks reduced the daily hours during which cash was available from their branches (Chart 16).

The COVID-19 pandemic decreased sharply the demand for EUR 50 banknotes for travel purposes

Growth in the issuance of cash remained positive in 2020, i.e. cash orders exceeded the level of returns, even though withdrawals of cash for travel abroad decreased significantly due to the travel restrictions imposed in response to the pandemic.

There was a particularly marked decrease in the issuance of EUR 50 banknotes (Chart 17).

Orders from and returns to the Bank of Finland of other banknote denominations have also decreased during the pandemic, as the distribution and use of cash decreased more rapidly than in previous years (Chart 18).

Banknote custody services provided by the Bank of Finland reduced transportation by cash supply companies

Following the closure of the Oulu regional office, the last regional office outside the Vantaa office, the Bank of Finland has provided private cash supply companies with interest-free cash custody services.

The Notes Held To Order (NHTO) custodial system for cash was launched almost in full volume at the beginning of May 2019. The maximum volume of the custodial system was assessed in spring 2020.

The possibility to place cash into custody at local distribution centres effectively reduces unnecessary transportation of cash to the central bank only to avoid interest charges.

Counterfeit euro cash in Finland

The number of euro counterfeits detected in circulation in Finland increased slightly in 2020. In Finland, a total of 1,496 counterfeit euro banknotes and 750 counterfeit euro coins were found (Chart 19).

The increase in the number of detected counterfeits in the past couple of years reflects in particular the prop banknotes for movies sold online.

Of the different denominations of banknotes in circulation, the EUR 20 was the most frequently discovered counterfeit note in 2020.

Next article

Environmental impacts of cash supply in 2020: less transport kilometres