Switzerland embraces Digital Payments, Leaving Cash Behind
Switzerland is moving towards a cashless society. A recent survey by the Swiss National Bank reveals that digital transactions now outnumber cash payments. This shift marks a significant change in a country were cash has traditionally been king.
Historically, the Swiss have favored cash for it’s privacy and convenience. On average, each person held around $10,481 in cash. However, the survey shows that debit cards are now the preferred payment method. In 2024, 35% of in-store purchases were made with debit cards, surpassing cash at 30%. This is a stark contrast to 2017, when only 21% of payments were card-based.
According to Alexander Koch, an economist at Raiffeisen Switzerland, the pandemic has accelerated this shift. He notes that German-speaking countries, including switzerland, have been slower to adopt digital payments compared to the Netherlands and Scandinavia.
Despite this trend, Switzerland still ranks second globally for cash holdings per person. However, public transport operators are planning to reduce cash acceptance, further pushing the country towards digital payments.
Dominic Weibel, head of research at Bitcoin Suisse AG, sees this as a positive sign for digital money. He points to cities like Lugano, where Bitcoin and stablecoins are accepted for everyday transactions.Weibel believes this trend will expand, tho at a slower pace than in countries with devalued currencies.
The survey also found that 18% of payments were made via mobile apps, while credit cards accounted for 14%. Weibel sees a significant role for stablecoins in Switzerland’s evolving payment landscape. He argues that tokenized Swiss francs could streamline payments and unlock new functionalities.
Though, the Swiss National Bank is cautious about introducing a central bank digital currency (CBDC). Senior economist Thomas Moser notes that privacy concerns and potential costs outweigh the benefits. He emphasizes the importance of data protection, highlighting that cash allows for anonymous transactions.
Despite this, institutional engagement with blockchain technology is growing. UBS’s issuance of digital bonds and the SNB’s wholesale CBDC pilot demonstrate this acceleration. Weibel expects this trend to continue across various sectors in the coming years.
