Italy and the cashless revolution

A little over a year ago, the Italian government launched the Italia Cashless program, with the declared aim of relaunching consumption, increasing the digitization of the country and above all reducing tax evasion through the traceability of operations. a revolution that is felt especially among young people, less culturally tied to cash and more accustomed to using alternative means of payment to make their purchases, especially online.

According to a survey commissioned by Paribas Cardif, on a sample of a thousand young people between the ages of 15 and 30, for more than half of the interviewees, the future will be increasingly cashless, with a prevalence for the use of portable devices (such as smartphones) and a tendency to abandon all forms of cash. A trend that also reflects the beliefs of the older generations, even if in samples taken in the age group between 35 and 60 years, less than 14% of the total thinks that cash will be totally abandoned in the next future.

Although the main objective is the fight against tax evasion, not least they also want to modernize the mentality of the country with regard to the use of smart payment systems. In fact, Italy is last in Europe for the number of operations per capita with instruments alternative to cash and remains in 33rd place in the world ranking for the incidence of cash in the economy. This despite the years of the pandemic, which “motivated” Italians to seek alternative methods of payment, even for purely hygienic reasons (again among young people, this is one of the reasons given for abandoning cash, in favour of alternative methods such as cards and satispay). However, the problem of payment guarantee and privacy remains particularly felt, for they are not sufficiently guaranteed according to the samples of interviewees at the state of affairs. More effective incentive programs would seem to be the most effective method for “educating” people to abandon cash. 85% of Italians – the survey found – are oriented towards cashless payment solutions and only the remaining 15% are still ready to use exclusively cash.

According to a poll by Ipsos, almost all Italians have a debit or credit card (about 95%), although a still relatively small percentage uses them regularly instead of cash in everyday purchases (about 63%). The penetration of other forms of smart payment would be around 29% at the moment. Also in this case, young people are more inclined to use alternative methods, with 45% in the 18-24 age group using smart payment methods in everyday life. the use of cash would take place in an increasingly rarefied way, sometimes only once a week, compared to the ever-increasing use of new payment methods. In the five-year period 2021-2025, an increase in digital transactions of 12.7% per year is expected if the current trend were to be confirmed. E-commerce is expected to act as a driving force for cashless payments, which should lead to a total percentage of 24% of transactions carried out by 2025. Also according to the Ipsos survey, almost half of the respondents (47%) said they were open to the adoption of new payment instruments for their everyday expenses. The high transaction costs, however, for 73% of respondents would limit the acceptance by the shopkeepers of cashless payment methods.

Thanks to these new payment channels, the differences between online and offline payments are rapidly reducing, with a clear simplification of the channels that move quickly from traditional systems to more modern trends. This phenomenon is also linked to the perception of end-users, who consider the new payment methods to be safer (each transaction is tracked, so it is almost always possible to return the stolen goods in the event of a scam, which does not happen with cash), and according to the widespread perception, these new methods would guarantee, as also desired by the government, a recovery of the undeclared, especially the evaded VAT. The statistics would confirm a recovery of the same in continuous increase thanks to the tracking of payments. Given that VAT evasion still amounts to more than one hundred billion euros a year, this becomes one of the most heartfelt arguments, in addition to the fact that the recovery of tax evasion should calm consumer prices, further pushing purchases. in a moment of suffering for the national market.