BOK Working Paper No.2024-12, Digital Literacy and Physical Cash Demand during the COVID-19 Pandemic

등록일
2024.10.31
조회수
6090
키워드
Digital Literacy Currency Payment Social Distancing
등록자
Kyeongtae Lee, Jaevin Park
담당부서
Financial & Monetary Economics Team(02-759-5188)

Author : Kyeongtae Lee(Bank of Korea), Jaevin Park(Soongsil University)


<Abstract>


We examine the impact of the COVID-19 pandemic on consumers’ cash demand and tendency towards mobile app payments by focusing on digital literacy. In particular, based on the 2021 Bank of Korea’s Payment Methods Survey, we estimate the likelihood of a shift in payment methods based on social distancing levels. We provide evidence that digital literacy is mainly associated with preferences towards cash and mobile payments: The probability of decreasing cash holdings and increasing mobile app usage is significantly greater for digitally literate consumers. During the COVID-19 pandemic, the likelihood of using mobile apps increases with tighter social distancing measures; however, the propensity to hold cash and the proportion of cash payments are not significantly different across distinct levels of social distancing. Our findings suggest that policy options for alternatives to cash are required to mitigate the welfare loss of digitally illiterate consumers as the emergence of cashless stores is prevalent following the COVID-19 pandemic.


내가 본 콘텐츠