The COVID-19 Cash Out
While Chinese authorities have been destroying banknotes that have potentially come into contact with the coronavirus, Western countries remain woefully behind not just in their response to the pandemic, but also in adopting digital payments. One silver lining to the COVID-19 crisis is that this may soon change.
CAMBRIDGE – Because hand-to-hand exchange of physical currency could transmit the coronavirus, countries around the world are being forced to reconsider the use of cash. In fact, COVID-19 might turn out to be the catalyst that finally brings digital payments fully into the mainstream. Not surprisingly, the digital-payments industry is already focusing on the opportunities created by the crisis.
China’s government, for its part, has begun to disinfect and even destroy banknotes to mitigate the spread of the virus, at least in the short run. For example, Hong Kong’s South China Morning Post reports thata local branch of the People’s Bank of China in Guangdong province has been destroying money that may have circulated through high-risk settings such as hospitals and food markets. For fear of importing contaminated currency from Asia, the US Federal Reserve has initiated quarantine measures for physical dollars from the region.
Such actions are probably justified, considering that currency in circulation can indeed serve as a vehicle for transmitting pathogens – much like a mosquito. Studies have found that the human influenza virus, for example, can remain alive and infectious on banknotes for 17 days. Accordingly, it would not be unreasonable to assume that physical currency has played a role in spreading COVID-19 as well.