- 59% of survey respondents believe that currency will always be needed.
- The most common reason for hesitation to use CBDC is worries about privacy.
Despite rising demand among central banks in Central Bank Digital Currencies (CBDCs), a recent Deutsche Bank survey revealed that the majority of consumers in the United States, United Kingdom, and Europe are still unable to embrace digital currencies. The majority of the 4,850 persons polled prefer traditional payment methods like cash and credit/debit cards to CBDCs.
Cash Over CBDCs
According to the survey, 44% of respondents would rather use cash than CBDCs, and an impressive 59% feel cash will always be important. Only 16% of those polled believed that CBDCs would become broadly accepted in the near future, indicating a considerable gap between central banks’ aspirations and popular attitudes.
Privacy concerns are a primary reason for the reluctance to embrace CBDCs. More than a third of participants said they would prefer a government-backed cryptocurrency to one handled by private businesses, although privacy worries remain. Many respondents, particularly those in the United States, believe that private cryptocurrencies such as Bitcoin provide better privacy than state-backed digital currencies.
Consumers have a strong worry about privacy. In the United States, 21% of respondents believe that a generic cryptocurrency provides greater privacy than a government-backed digital currency. In Europe, more people prefer cash because of its anonymity than in the United Kingdom and the United States.
Despite this hesitation, central banks such as the Swiss National Bank, the European Central Bank, and the Federal Reserve Bank of New York are still focusing on wholesale CBDC applications. These activities are part of a larger push to upgrade financial systems and increase transaction efficiency.
The COVID-19 pandemic has accelerated the trend toward digital payments, particularly among Gen Z, and central banks have turned to CBDCs as a bridge between traditional fiat and digital finance. However, due to concerns about confidentiality and a strong preference for cash, widespread consumer acceptance remains suspicious.
In contrast, European respondents overwhelmingly opted for cash, owing to the confidentiality it offers. This is consistent with previous research, such as a Bank of Canada survey, which found that 86% of Canadians turned down CBDCs and 92% favored physical currency over a digital Canadian dollar.
As central banks keep looking into wholesale CBDC use cases, eliminating user doubt will be critical to widespread adoption.
