Despite the push toward cashless payment methods, cash is still a popular means of payment in most countries, particularly those with large rural and unbanked populations, according to a new report by London-based research and consulting firm RBR.
The RBR report "Global ATM Market and Forecasts to 2024" offered the following key insights.
ATM cash withdrawals will increase in most countries
Last year, the total number of ATM cash withdrawals worldwide dropped by 3% to 95 billion, and is forecast to continue falling, the RBR study found.
However, this global view masks how the use of cash is evolving in many countries. In fact, cash withdrawal levels are expected to rise in over half of the 63 major markets surveyed in the RBR report.
In Latin America, where governments and banks are pushing hard to bank the unbanked, newly-banked customers will help drive growth in cash withdrawals. Every Latin American market surveyed will witness increasing withdrawal numbers, with growth projected to be fastest in Peru at an average yearly rate of 3%, the report said.
The Middle East and Africa and Asia-Pacific will also see rising cash withdrawal volumes in the majority of markets, with financial inclusion measures an important contributing factor. Indeed the fastest growth rate worldwide will be an average annual increase of 9% in Pakistan.
Demand for cash will increase in Asia-Pacific
Last year, the total number of ATM cash withdrawals in Asia-Pacific fell by 4%, and while numbers are forecast to rise in 10 of the 16 Asia-Pacific markets surveyed, the total for the region will continue to drop, the study found.
Use of ATMs to access cash will go up in India, the region's second largest market, and remain broadly stable in the third largest, Japan. Meanwhile, cardholders in China will make 5% fewer ATM cash withdrawals year-on-year over the period 2019 to 2024.
The success of WeChat Pay and AliPay in China means that cashless payments have now infiltrated the daily lives of most Chinese consumers. More and more Chinese are leaving their bank cards and wallets at home in favor of their mobile phones.
New payment methods influence demand for cash
While China offers a striking example of recent and rapid change, it is far from the only market where the payments landscape has altered greatly in recent years, with consumers being presented with new ways to make payments.
In the U.K., for example, card acceptance has increased in rural areas, and contactless technology is a key factor in changing consumer habits. In many of the more established payments markets, demand for cash will fall, with consumers now able to pay for products and services in a number of different ways. In developing markets, however, ATMs and cash will continue to play a crucial role, particularly in financial inclusion strategies, RBR said.
"The practical benefits of cash and a strong sentimental attachment among certain customer segments will help to keep it relevant," Rowan Berridge, who led RBR's research, said in a news statement.