Coronavirus pandemic puts dirty money under the microscope

- By Collaborative Media & Publishing
Banknotes and coins have acted as an effective medium of exchange for centuries – but do they also inadvertently help spread germs and diseases?

The sudden onset of coronavirus (COVID-19) has put the question in stark relief as its exponential spread undermines fundamental assumptions about the way we live.

When it comes to handling cash, many countries have taken no chances when faced with a pandemic.

China, where the outbreak originated, recently ordered banks to withdraw potentially infected cash from circulation and disinfect it before re-issuing it to the public. South Korea quarantined banknotes for two weeks and super-heated banknotes to 150 degrees Celsius to effectively disinfect it.

Other countries have taken similar steps given banknotes and coins present another high-touch surface that is regularly exchanged between people.

While cash usage continues to be widespread, the NSW government has urged employees who occasionally handle it, to immediately clean their hands with soap and water or hand sanitiser to help stop the spread of coronavirus. It also recommends that employees who regularly handle cash should also wear gloves and continue to perform the same stringent hand hygiene.

Some retailers have taken those recommendations a step further and moved to all digital transactions to protect their employees (although cards and phones can also harbour micro-organisms and need to be kept clean).

Scientific evidence suggests cash can harbour viruses
Coronaviruses make people sick by entering the body via the mouth or nose. While COVID-19 is a new type of coronavirus, there is some scientific evidence that cash could potentially play a role transmitting the virus.

A January 2020 review of 22 previous scientific studies found that previously identified human coronaviruses (such as SARS) can persist on inanimate surfaces like metal, glass or plastic for up to nine days, although surface disinfection procedures effectively kill the virus.

"Data on the transmissibility of coronaviruses from contaminated surfaces to hands were not found," the study noted.

However, a 2008 study, Survival of Influenza Virus on Banknotes, found that more common Influenza A viruses could survive up to three days on banknotes and up to 17 days in the presence of respiratory mucus.

"The unexpected stability of influenza virus in this non-biological environment suggests that unusual environmental contamination should be considered in the setting of pandemic preparedness," the study's authors wrote.
Other studies have suggested other types of micro-organisms (not all harmful) also live on banknotes.

It is a complex issue, especially given each country prints money on different materials. The Reserve Bank of Australia is currently rolling out its Next Generation range of banknotes, which are made of polymer. They are more resistant to moisture and dirt than traditional cotton fibre banknotes made in countries such as the US.

Consumer confidence that hard cash will always be an accepted form of payment is crucial for the smooth functioning of society. However, concerns about coronavirus are having many unexpected consequences – it may also increase an already strong swing towards contactless cards, mobile and online transactions. 

The ongoing rise of digital transactions
Australians have been among the world's quickest adopters of contactless debit and credit cards, while online and mobile payments are also growing in popularity, at the expense of cash.

The share of consumer payments made in cash fell to 37% of the number of total payments in 2016, from around 70% in 2007, according to the RBA.

More recently, BPAY Group's launch of real-time payment service Osko (which is built over the New Payments Platform), has provided another impetus to replace the immediacy of cash.
Social isolation and lockdown policies aimed at stopping the spread of coronavirus could speed up the trend. With many non-essential shops and businesses shut down, cash is no longer a viable payment mechanism.

However, other cards and other digital payment mechanisms can still be used online or remotely. While many older Australians will no longer be paying bills at Australia Post offices, they can still use online mechanisms such as BPAY. Similar institutions, such as local councils, may be in a comparable position and consider expanding their payment options.

Other countries such as China have very different payment systems than Australia but have quickly moved to a digital environment. China's $US3 trillion mobile payment market is the world’s largest with Alipay and WeChat sharing 85% of the market.

In February, as the Chinese government moved to disinfect banknotes, Fan Yifei, deputy governor of the PBOC, told reporters that it would accelerate work in the field of mobile payments in a further bid to reduce contact between people.

"Recently, there have been some new developments in various places – people pay for their orders on their mobile phones, and they can buy fresh and affordable meat, eggs, vegetables and fruits without going out, which has solved a major problem in people’s lives during the outbreak," he said at the time.

While China's autocratic government can press ahead with new payment technology regardless of the slowdown in the global economy, the economic impact of stopping large segments of global economic activity may curb FinTech innovation in other regions for some time.
Published by BPAY Pty Ltd (ABN 69 079 137 518). The BPAY Scheme is managed by BPAY Pty Ltd. BPAY Payments are offered by over 150 BPAY Scheme members. When you use BPAY the BPAY Scheme is paid fees relating to processing costs and BPAY Scheme membership. Contact your financial institution to see if it offers BPAY and to get the terms and conditions. Any financial product advice provided by BPAY Pty Ltd in relation to BPAY payment products is general advice only and has been prepared without taking into account your objectives, financial situation or needs.  Before acting on such advice, you should review the Product Disclosure Statement and consider whether BPAY payment products are appropriate for your personal circumstances.

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