The Irreplaceable Role of Cash in Times of Crisis

Article published by the European Central Bank (ECB) analysing how demand for euro cash surges in times of uncertainty, specifically during major recent crises —the 2008 financial crisis, the 2014-15 sovereign debt crisis in Greece, the COVID-19 pandemic, Russia’s invasion of Ukraine in 2022, and the Iberian blackout of April 2025. The study highlights that the unique attributes of cash —its tangible, resilient, offline nature (i.e. independent of networks, electricity, telecommunications or external authorisations) and its wide acceptance— make it both a safe-haven asset and an essential payment instrument in times of crisis. For these reasons, several European and national authorities (including the governments of the Netherlands, Austria and Finland) have issued recommendations to the general public to keep some cash reserves in case of sudden and unexpected contingencies.

Key Takeaways

• Resilience under stress: Each of the crises analysed triggered immediate and extreme increases in cash demand.
• Trust and accessibility: Cash remains the only universally accessible means of payment, requiring no technological infrastructure.
• Complement to digital payments: The ECB stresses that the digitalisation of payments does not eliminate the need for cash; rather, both systems reinforce each other.
• Structural demand growth: Although the use of cash in daily transactions has declined in the euro area, the value of banknotes in circulation has grown significantly over the past two decades, underscoring its role as a store of value. This was seen very clearly during the COVID-19 crisis.
• Unique attributes in times of crisis: The fact that cash is tangible, resilient, offline and widely accepted makes it a key resource in times of crisis. For this reason, several European and national authorities have recommended that citizens keep cash reserves to face unexpected contingencies.
• Financial stability: Guaranteed access to cash strengthens confidence in the monetary system and reduces vulnerability to technological failures or cyberattacks.
• Public policy perspective: Protecting cash as a public good is seen as essential for social cohesion and citizens’ autonomy in Europe.
• Some data from the study on the evolution of cash in crisis situations:
  - Impact of the war in Ukraine: In countries bordering the conflict, during the first month of the invasion there was an estimated 36% causal increase in average daily net banknote issuance.
  - The April 2025 Iberian blackout: The loss of power and telecommunications rendered digital payment systems inoperative across the Iberian Peninsula:
  o Preceding days: cash withdrawals in both affected and unaffected areas remained normal.
  o Day of the blackout: ATMs in affected areas went offline and withdrawals collapsed, while in unaffected areas withdrawals spiked due to precautionary demand.
  o Subsequent days: once power and ATMs were restored, withdrawals in affected areas sharply exceeded normal levels.