Printer of Banknotes Faces Business Challenges Amid Drop in Demand

Printing money is a tough business, according to banknote producer De La Rue.

April 14, 2023

ALEXANDRIA, Va.—In a sign of the times, De La Rue, a 200-year-old printer of paper money that prints banknotes or supplies raw materials for physical cash to 140 countries, issued a profit warning to analysts.

Demand for paper money is at 20-year low. In the UK, debit cards overtook cash in 2017, and only about 15% of transactions now involve cash. The figure was 60% a decade ago.

More than 23 million people in the UK use cash only once a month or not at all, according to industry figures, while as few as 1 million rely on it for most of their day-to-day shopping, reports the Guardian.

De La Rue will produce millions of banknotes featuring King Charles in advance of his coronation next month, but that is only a small boost to its production. Adding to the low demand is the fact that banks stockpiled cash during the pandemic and are now working through that reserve. Another factor is that banknotes, now often printed on polymer, last much longer than in the past.

According to Pew Research Center, 41% of Americans report that none of their purchases in a typical week are paid for with cash. The report noted that “Americans with lower incomes continue to be more reliant on cash than those who are more affluent. Three-in-ten Americans whose household income falls below $30,000 a year say they use cash for all or almost all of their purchases in a typical week.”

A related development is the decline of ATMs. The number of machines in the U.S. peaked in 2019 at 470,000 but has since fallen to 451,500, according to research firm Euromonitor International.

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