Why do euro banknotes disappear? What replaces them in people’s wallets?
The euro banknotes are disappearing and soon this process will be completed: let’s try to understand what it is happening.
There is less and less cash in circulation. It is a process of progressive disappearance that it is worth knowing also because it presents numerous pitfalls. But how is it possible that the banknotes are disappearing?
Banknotes disappear from circulation
Above all, I want the disappearance of the banknotes the banks and the government. Let’s see why.
Physical banknotes force banks to keep many branches and ATMs open. For the banks this is a huge expense. As long as there is material and physical money, branches and ATMs are needed but the institutions do not like this and have been cutting both physical offices and ATMs for some time. But the government doesn’t like physical money either. In fact, the government is fighting hard against tax evasion but as we well know as long as cash exists, tax evasion will always be possible.
Here are the reasons and how they are replaced
In fact, the doctor who wants to evade the tax he will have a good time asking for payment in cash which can never be detected and tracked. So the banknotes represent a problem so much for the government that wants to fight tax evasion and for banks that are forced to keep ATMs and offices open. The alternative to cash already exists and is gaining ground but for many it represents a danger. In fact, digital and traceable payments are already a reality but many argue that these payments are actually only useful to banks.
What changes and the controversies
In fact, digital money is traceable it does not constitute any cost for the bank which is not forced to keep the physical offices open. But with every transaction, that is, with every payment, even small and trivial, that is made with digital money a small commission is always applied. So for the banks there are many advantages and in addition also a strong reduction in costs. This is why the banknotes will gradually disappear. But this according to many will be useful in combating tax evasion but it represents a unfair advantage for banks.
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