The use of the card against cash continues to skyrocket after the pandemic with thousands of ATMs closed

The pandemic has accelerated many transitions that have been taking place in recent years and banks have given a good account of it. For example, the impulse that card payment had during the most difficult moments of the health crisis. The need to limit contact led to the generalization of this method of payment compared to cash. The data that is becoming known as the months go by confirms that the use of the card continues to gain strength compared to cash while ATMs disappear and payment terminals, commonly known as POS terminals, multiply.

In 2021, card operations exceeded the barrier of 6,000 million in Spain for the first time, according to statistics from the Bank of Spain. They are more than double those that were made just five years ago. The record levels are on the way to pulverize this year as well, according to the results of the first quarter, in which there was a growth of 27%. In these three months, more than 1,600 million card payment operations have been carried out. The return to consumption and the growth of tourism, pending the impact that inflation may have, are accelerating even after the pandemic this type of operation.

It is true that the return to normality is leading to a general growth in operations, also in cash. In this case, the number of times cash is withdrawn from the ATM is taken as a reference. Although, the rate is much lower in this case compared to the times that plastic is used for consumption. If last year purchases with cards grew by 28%, cash withdrawals at ATMs grew by 4%. And this year the difference is a growth of 27% for plastic compared to 7% for cash.

The action of looking for an ATM to withdraw money has become an exceptional issue, especially for younger consumers, who have assumed plastic cards as their main payment method. The pandemic has only accelerated a trend in which more and more businesses allow purchases even without limits for the smallest operations.

However, for the other age levels, ATMs continue to be necessary to withdraw money in cash or to operate with banks, since physical teller windows have limited their activity. At the beginning of this year, in the midst of the debate on financial inclusion, the banks approved a generic decalogue of commitments to serve the elderly population. Among these points he placed the promise of using the ATMs to maintain "face-to-face" contact and attention to these customers.

But, at the same time, the ATM network has significantly decreased in recent years. Banks have been looking for formulas to offer these devices outside their offices, in stations or places with a lot of traffic. Despite this, the data show how ATMs have been disappearing in Spain, although they have done so in a lower percentage than the number of bank branches. In March of this year there were 46,473 ATMs in Spain. They are 1,200 fewer than three months earlier and the cut is 4,000 when compared to December 2019, the last data prior to the outbreak of the pandemic.

At the same time, the park of active POS terminals in Spain, the devices that are placed in stores to make payments, has skyrocketed. In just three months, more than 44,000 terminals have emerged. Regarding the course prior to the pandemic, growth has been more than 310,000. There are currently 2.25 million of these devices in operation.

Until 2016, these statistics showed how in Spain the amount of money withdrawn at ATMs was greater than that spent through card payments. Then, there was a sorpasso that has not stopped expanding during this five years, accelerating after the pandemic. Operations with plastic money moved 195,000 million euros during the past year. It was 20% more than the record that had been reached in 2019, before the pandemic. Between January and March of this year the rate is even higher, with card spending increasing by 28% compared to the same period in 2021, to 50,000 million. In this first quarter, ATM withdrawals have moved just over half of the money, about 26,000 million

The extension of card payment in many small businesses is seen in the increase in small purchases. Spending limits that were imposed in the past in many stores or in the hotel industry are now the exception to the generalization of card payments. This is confirmed in the statistics of the Bank of Spain. The average payment by card stood at 31 euros in the first quarter of this year, sustaining the continuous drop that these operations have experienced since 2014. In the case of cash withdrawals, the average has followed an opposite trend, rising, going from the 137 euros prior to the pandemic to 174 last March.

Card payment has also been favored by the impulse that Bizum has had. This tool, born in 2016, has meant a change in micropayments and the company, owned by all the large Spanish banks, figures that more than 1,100 million operations have been carried out since then. They add up to a total of 58,000 million euros in transfers.

At the same time that the pandemic has accelerated changes in household payment habits, regulatory measures have been put in place that increasingly limit cash payments. Last year, the anti-fraud law came into force, once again reducing the limit for cash payments between companies from 2,500 to 1,000 euros and maintaining the limit of 2,500 euros for individuals. The payments that foreigners can make in Spain in cash were also reduced from 15,000 to 10,000 euros.

In March of this year, the highest level of cards in circulation was reached in Spain. It reached 88.2 million, about 200,000 more than there were at the end of last year. In other words, there are 1.8 cards per inhabitant in Spain. Credit cards are especially growing compared to debit cards. Credit cards are closely linked to consumer loan vehicles, a figure on which banks have focused in recent times to profit from the improvement in the economy after the pandemic. According to these statistics, 55% of cards in circulation are debit cards.

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