Will Europe's Love for Cash Survive Instant Payments?

When was the last time you paid with cash? If you’re in London, you might struggle to remember. But in parts of Europe, cash is still king—at least for now.

Just before Christmas, I was delighted to unwrap an early gift from an unlikely source: the European Central Bank. They had just released a fascinating study about how Europeans pay for things. The headline? Cash is still king.

Despite the rise of contactless payments and digital wallets, Europeans still use cash for more than half (52%) of point-of-sale transactions—only a slight drop from 59% in 2022. 

For many city dwellers, this might be surprising. In London, "card only" signs are becoming the norm. But cash remains deeply embedded in daily life across much of the continent. I learned this firsthand on a trip to Santorini last year.

Cash only

After a relaxing stay in Oia—a beautiful village in the northwest of the island—my husband and I decided to explore Fira, the bustling heart of Santorini via bus.

When the bus pulled up, we got aboard with our debit cards at the ready, asking for two tickets. The driver looked up, waved his hands dismissively and replied, “Cash only.”

The payments professional in me froze. Cash only? When was the last time I’d even carried cash? These days, I never do. One of the last places I’d expect to need it was in a busy European tourist destination.

However, cash, as I continued to discover, is overwhelmingly the preferred payment method in Greece. Every coffee I sipped, gyros I ate, and taxi ride I took, I was asked to pay in cash.

Despite the availability of alternative payment methods, Greece ranks first in Europe for cash preference in peer-to-peer, according to the ECB.

This, in part, is due to the Greek debt crisis, where citizens lost access to their deposits and could only get limited access to withdraw. But Greece also experiences more technical difficulties with its payment infrastructure than any other country. 

Nearly one in five (17%) Greek respondents reported issues with card payments compared to over one in ten (13%) across Europe.

While the ECB report focuses on consumer habits, we know that card payments are not cheap for merchants. So, while most restaurants and bars in Greece accept cards, it’s easy to see why cash is preferred. The networks take a slice, as do the acquirers, so many businesses will still happily take your coins instead. 

The global rise of instant payments

While Greece remains cash-heavy, other parts of the world have leapfrogged straight to digital payments—bypassing cards altogether. India is a prime example.

Less than a decade ago, India, my home country, was a cash-reliant economy. But in 2016, with the introduction of UPI (Unified Payments Interface), an instant payment scheme, this changed.

India has embraced UPI at a pace few could have imagined. Over 350 million people use it monthly, and around 80% of digital retail transactions are now UPI-based.

On a trip home, I found tea stalls accepting payments for as little as a penny via UPI QR codes (printed on paper and pinned to a table). Hard-to-reach communities, which once struggled to send and receive money, can now easily access the mainstream economy. It has transformed the market.

Other instant payment initiatives have borne similar results. Brazil with PIX, Kenya with M-Pesa, and Thailand with PromptPay.

Europe will introduce instant payments later this year as part of the Instant Payments Regulation (IPR). Starting in October, every bank in the Single European Payments Area (SEPA) must be able to send and receive payments in 10 seconds or less. 

These fast, frictionless, and (mostly) free transactions will be available 24/7, 365 days a year, and cost no more than a traditional digital payment.

Unlike in India or Brazil, where consumer demand drove instant payment adoption, Europe's shift is regulatory-driven. The real question is whether people will use it.

Faster is better

Among the top benefits of cash for Europeans overall were anonymity and privacy (41%), expense control (35%), and instant transactions (30%). 

Instant payments do not directly address the first benefit. But they have a good answer for the latter points as they’re fast, secure, help with financial management and available 24/7.

But there’s so much more. Instant payments in Europe will allow buskers and restaurant staff to receive tips instantly. 

With earned wage access schemes, employers can pay their staff daily, strengthening recruitment and retention. 

You and I can settle the bill for our drinks and taxi ride before we get home from our night on the town. Businesses, from small corner stores to multinational corporations, will be paid on the spot by their customers. 

Supply chains, cash flow, and business-to-business relationships are boosted as the speed and velocity at which money changes hands increase.

Instant payments will also help to reduce European reliance on US card networks. That will make it cheaper for merchants to accept digital payments.

 In other words, they go a long way to solve many of the reasons cash is the preferred choice.

Old habits die hard 

Cash is on a slow but steady decline, but old habits die hard. With instant payments rolling out across Europe by the end of 2025, the big question is whether the Greeks and their fellow Europeans embrace them as India has with UPI or will cash remain a stubborn favourite.

With its pastel sunsets, rugged cliffs, and unwavering preference for cash, Santorini captures Europe’s complex payment landscape. But as instant payments gain traction, this picture could change.

We’ll have a clearer answer by the time the ECB releases its next report in 2026. Until then, I’ll be keeping my card—and maybe a little cash—close at hand for my next trip to Fira.