Governments have recognised the systemic importance of cash at a time of rising geopolitical uncertainty. The Rogers Telecom outage in Canada (2022) shows what happens when POS, online and wallet payments don’t function: payment volumes plunge, and economic activity drops sharply. Alongside cash’s importance as a resilient payment method, governments in the UK (2023), the US and the EU (both 2025) and Sweden (2026), have mandated cash access to assist groups such as the elderly, low income, and disabled.
On top of these factors, a historic preference for cash makes Germany special. While the UK and Netherlands have seen cash use decline to below 20%, cash remains relatively popular in the Federal Republic at 45% of all transactions and 99% of German businesses still take cash, according to 2025 figures from the Bundesbank.
However, last year’s Bundesbank figures also show that cash-based transactions have declined from around 80% in 2015 to 45% in 2025. As investment decisions regarding cash infrastructure made now will affect the next 10-15 years, it’s important to extrapolate long-term trends into the future. Even if current trends slow and cash use continues to decline by just 2% annually, Germany would still reach cash use levels like those seen in the Netherlands today by 2040.
A new ATM service model for Germany?
Given these trends, it’s legitimate to ask whether German banks should keep cash as a mass market payment method in their investment planning approach – or adopt an approach similar to the Netherlands and Nordics: namely, that cash is an emergency infrastructure requirement, which means efficient structures and shared investments become the highest priority.
Based on our conversations with German banks, it’s clear that as cash usage declines, the costs of cash provision continue to rise. Banks tell us they are required to invest in higher standards of security at a time when fewer customers use cash and branch networks are rationalised. Relocating ATMs and collaborating with supermarkets on cashback programmes have only limited cost impact, especially when investment in ATM security is growing and the cost of handling and transporting cash is also rising sharply.
Our analysis suggests that as they look to the 2030s, German banks should not think in terms of ATM terminal numbers or third-party partnerships. Prompting banks to reconsider how ATM services are operated, the role of outsourcing and the benefits it could bring in reducing operational complexity and cost.
Avoid soaring costs through flexible approaches
Many local providers of cash or other ATM services mandate the use of certain hardware items. Others provide only parts of the software or hardware needed, which raises risk and increases the requirement for manual interventions in areas such as cash ordering or movement. We agree with those bankers who tell us this situation isn’t sustainable – from a cost perspective as much as performance.
To keep costs down and simplify cash service management, banks may rely on an outsourced partner to help them manage compliance. In our view, banks should look to outsource the entire value chain to an experienced provider with skilled ATM engineers and dedicated teams of experts that can introduce changes to ATM software and hardware within weeks of being commissioned. This helps banks to retain control while taking advantage of a more open and modular approach to ATM management – truly a model fit for the future.
