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Pandemic Or Not, Germans Still Prefer Cash

A cashier accepts payment from a customer in Munich in March.
Matthias Schrader
A cashier accepts payment from a customer in Munich in March.

Just as in other countries, grocery stores in Germany are hushed, angst-ridden places these days, where a controlled number of masked shoppers give each other a wide berth in the aisles. At the checkout, the cashiers — also masked — sit behind a plastic screen. Exchange with customers is kept to a minimum and contactless payment is encouraged.

But in a country where cash is traditionally used for most everyday transactions, some shoppers feel using a debit card is one coronavirus measure too many.

In a grocery store in Berlin, Valerie Meyer pays for her groceries with coins, counting them out for the cashier.

Meyer, 41, says she knows the supermarket installed a contactless payment terminal because of the pandemic, but she has no intention of using it.

"I'm not in the slightest bit concerned about using cash right now," she says. "I touch other things in the grocery store, too, so why not use cash? I just keep washing my hands. Simple."

Meyer says she uses plastic only when she has no choice — for booking flights or hotels. The pandemic has actually brought her credit and debit card use to a halt, she says.

"When I use a card, I have the feeling I've got an unlimited supply of money, and that's not the case," Meyer says. "With cash, it's easier to see when you've overspent because it's gone."

Meyer's views are not uncommon in a country where a historical fear of debt and surveillance is widespread. While supermarkets in Germany accept cards, many smaller stores and restaurants do not. Although the coronavirus has prompted retailers worried about hygiene to offer contactless payment, the pandemic hasn't killed cash.

Germany's central bank issued 17 billion euros more notes and coins in March than it did the previous month. The Bundesbank told NPR that while this spike was an initial reaction to the health crisis, consumer demand means the bank is still issuing normal amounts of cash, roughly 3 billion to 5 billion euros a month. Bundesbank executive Johannes Beermann even announced in April that using cash isn't particularly risky as long as consumers wash their hands.

The Bundesbank says it won't have an accurate picture of exactly how that cash is being spent until next year, but the German Association of Money and Bond Services says that although contactless card payments are on the rise — with almost a third of all card payments made this way since the outbreak of COVID-19 — cash still makes up 75% of Germany's transactions.

Historian Robert Muschalla, who curated the German Historical Museum's exhibition Saving: History of a German Virtue, says when it comes to money, Germans prefer it to be "real."

He explains: "They're suspicious of its more abstract forms, like stocks and shares, and they prefer to keep their assets in savings accounts. And so it comes to reason that they also prefer using cash to plastic."

While memories of Stasi — and even Gestapo — surveillance mean many Germans don't like banks knowing how they spend their money, Muschalla says the preference for hard currency goes back much further.

"It started with the so-called Panic of 1873, the financial crisis that saw small investors in Germany lose everything," Muschalla says. "Germans were so traumatized by it that they demonized all nontangible forms of money."

Saving for a rainy day is also ingrained in the national psyche. "When the middle classes lost their savings because of hyperinflation in the 1920s, counterintuitively, they went straight back to putting away their pennies again instead of investing in property or stocks," Muschalla explains.

Muschalla says it will take more than a pandemic to see the demise of cash. In fact, while the coronavirus has prompted other nations to stockpile toilet paper, the Bundesbank says it believes Germans have been stashing more cash than normal, either at home or in safety deposit boxes.

Back at the Berlin grocery store, 66-year-old Rainer Frödde, laden with tote bags, is a recent convert to plastic. He says he started using his debit card to pay for groceries for the first time in mid-March, when Germany went into lockdown. But Frödde hasn't abandoned cash. He's using it to pay for his groceries on this day.

"I forgot my card," he explains, "and couldn't have paid any other way."

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