French Interior Minister Calls for Elimination of Cash; What's Next for Europe?

French Interior Minister Gerald Darmanin's recent proposal to eliminate cash entirely to combat drug trafficking has sparked a lot of backlash and controversy, according to BFMTV. "A lot of everyday fraud and crime, even criminal networks, are fueled by cash," Darmanin told the Senate's inquiry committee on financial crime. According to the French Interior Minister, eliminating cash would close "deal points" and make it more difficult to finance illegal activities, as money would become fully traceable, like cryptocurrencies.

However, this transition is not a simple political decision, say journalists from the Heaxgon television station, but rather the result of collective behavior: in many countries, consumers are increasingly preferring digital payments. In Denmark, for example, only 8% of transactions are still made in cash, while in Sweden the proportion is 28%, and in Norway - 35%. In contrast, in France cash is still used in 51% of cases, and in Switzerland in 57%.

This evolution also has visible consequences: ATMs are becoming increasingly rare, especially in the Nordic countries, where the financial infrastructure is rapidly digitizing. However, the idea of the total disappearance of cash is still far from being accepted, even in the most digitized societies.

According to the cited source, the risks associated with a total dependence on electronic payments are multiple. For example, power outages, cyber attacks, natural disasters or armed conflicts can completely paralyze the digital infrastructure. That is why the Nordic countries are hesitant to "cross the Rubicon" in terms of eliminating cash payments, says BFMTV, the best example in this regard coming from Norway. Thus, in 2016, Norway's largest bank called for a ban on cash due to money laundering risks, but the Norwegian Parliament later passed a law requiring all stores to accept cash.

According to the cited source, Norwegian Justice Minister Emilie Enger Mehl emphasizes that "in a digital world, it is easy to forget that many people are not part of it." Norway's civil protection recommends that the population keep cash at home to be prepared in case of crises. "The world is increasingly affected by war, digital threats and climate change. We must be prepared for long-term power outages or failures of payment systems," warns Mehl.

The same approach is present in Denmark, where the governor of the National Bank, Christian Kettel Thomsen, acknowledges that although the use of cash is decreasing, society still needs it. In Sweden, the Ministry of Defense recommends that citizens keep a cash reserve to be able to deal with "crises and war", and the central bank adds that "efficiency is important, but more importantly, everyone is able to pay in case of crisis".

In other parts of Europe, cash remains dominant: in Germany and Austria, it still accounts for 69% and 73% of transactions, respectively. The German Federal Bank reminds us that, in case of emergency, there must be a functional infrastructure for the supply of cash.

Thus, although the global trend is clear, towards digitalization, the reality is much more complex. Cash is not only a means of payment, but also an instrument of security, social inclusion and individual sovereignty. In the face of the uncertainties of the modern world, it seems that banknotes and coins still have a role to play.