Kiwis hang on to the folding stuff

Where’s New Zealand’s cash hiding?

Despite an increasing number of electronic transactions each year, the volume of physical cash in circulation continues to grow.

Reserve Bank data shows $5.53 billion in notes in circulation last year, up from just under $5.5b the year before and $4.96b in 2015. Only the number of $100 notes in circulation is dropping.

The volume of physical money in circulation works out to a bit over $1200 in cash per person.

There are no nationwide statistics kept on the volume of cash payments in New Zealand, but banks routinely flag the exponential growth of digital payment channels and dwindling use of cash.

Banking commentator Claire Matthews, from Massey University, said it seemed illogical that the volume of cash circulating continued to grow.

‘‘But it’s a fact that it is. While I agree we should have reached ‘peak cash’, I don’t see the evidence that we have.’’

Her colleague, David Tripe, said it was not unique to New Zealand. There would be a criminal element using cash, he said, and as physical money became worth comparatively less, there was less incentive for people to find lost money ‘‘down the back of the chair’’.

Some money would be destroyed, he said, put through the washing machine or caught up in a bonfire.

‘‘Tourists hold a bit. It’s an ongoing trend.’’

New Zealand Bankers’ Association chief executive Karen ScottHowman described it as a ‘‘cash conundrum’’. The cause was not clear.

‘‘It may be that since events like the Canterbury earthquakes more people are holding cash in case of emergencies.’’