Clearing Up the Role of Cash Amid the COVID-19 Pandemic
It’s an understatement to say the coronavirus pandemic has triggered sea change worldwide, including how and where people work, shop and pay for their purchases. In some areas, cash is being quarantined because of the fear it could contribute to the spread of COVID-19.
Reuters reported the U.S. Federal Reserve, as a precaution, has been quarantining dollars repatriated from Asia before sending them back into circulation. The central banks in China and Korea have ordered that currency notes be either disinfected with ultraviolet light or destroyed. Some financial institutions, at least, are taking steps to ensure that cash is sanitized.
Cash quarantines aside, anxiety over the spread of the virus has also prompted some businesses to refuse to accept cash as a payment, which means the unbanked have no other way to pay for their purchases.
According to Christian Hawkesby, Assistant Governor and GM Economics, Financial Markets & Banking at the Reserve Bank of New Zealand, “Retailers should use common sense when it comes to cash. Businesses are not obliged to accept cash, but declining it may end of disadvantaging people who rely on its use.”
So perhaps, instead of avoiding cash, it’s a good time to stock up on it like many are doing with toilet paper, canned goods and hand sanitizer – and to be wise about social distancing and hand hygiene, as the Center for Disease Control and Prevention (CDC), suggests.
Show me the (evidence of COVID-19-contaminated) money
CBS News has reported that some businesses and individuals have stopped using physical currency because of the sheer number of people who handle cash throughout its lifetime. (Bills get traded constantly and stay in circulation from five to 15 years – and sometimes longer.) However, there isn’t much evidence to suggest that handling cash puts a person more at risk of being infected by COVID-19 than any other payment method – digital and non-digital. It’s what’s done after cash is handled that matters.
A recent MIT Technology Review article stated, “For COVID-19, it appears that people become infected by inhaling particles someone else has coughed or sneezed into the air, or by contacting a virus particle with their hand and then touching their eyes, nose, or mouth.”
Again, hand hygiene is necessary as is staying away from crowds and people who’ve contracted COVID-19.
Banning cash isn’t the answer
If the use of cash is banned, what else should be banned with it? Although smartphones aren’t passed around like money, they harbor germs, too. And what about the mobile wallets found on smartphones? Think, too, of ATM machines and card machine pin-pads used by hundreds of people daily – they are suspect of carrying infection. Restaurant menus are handled by many, and it’s hard to know who has touched the items on shelves at grocery stores.
The truth is people are more likely to catch COVID-19 in a movie theater, restaurant or crowded grocery store.
“You’re more likely to pick up COVID-19 from people exposure than from the type of payment,” said Marilyn Roberts, a microbiologist at the university of Washington School of public health, in a recent MIT Technology Review report.
Exposure to the virus through inanimate objects aside, a Wall Street Journal article reported that recent online outages at financial companies like Robinhood, Vanguard and Fidelity have made some people skittish about their financial accounts. Therefore, I’ll reiterate what I said earlier: perhaps people should keep extra cash available, just in case, just in case.
In conclusion, one recent article, widely circulated in the United Kingdom, claimed the World Health Organization (WHO) advised against using cash. Since then, the organization issued the following statement, reported by MarketWatch, claiming it was mispresented by the media:
“We did NOT say that cash was transmitting coronavirus,” said WHO spokeswoman Fadela Chaib.
Payment methods of any form, although possible, are unlikely to transport coronavirus and with new rules being implemented across the globe around social distancing and self-isolation, retail businesses have much larger concerns. Further, precautions amid the coronavirus are not only practical but necessary. Panic about using cash is not.