A Cashless Economy for Estonia ({{contentCtrl.commentsTotal}})

University of Tartu economics professor Raul Eamets
University of Tartu economics professor Raul Eamets Source: Photo: ERR

With just over a month before the switchover to a pan-European currency, University of Tartu economics professor Raul Eamets proposed for Estonia to adopt a cash-free economy - in other words, to get rid of physical cash and coins.

"It will make the economy more clear and transparent. The tax system will be improved and in the end we will all live better lives," said Eamets.

According to the professor, a wholly electronic monetary system would be cheaper and less cumbersome.

A majority of transactions are already cash-free. The Bank of Estonia alone, he said, spends 4.5 million euros a year on handling bills and change. This amount will increase in the future as the new currency will bring a greater share of coins into the Estonian economy, and it is more expensive to handle metal than paper. 

"Money distributes wealth within society from economic subject to another and money circulates more quickly when it is in the bank. In other words, wealth will be distributed more quickly,“ said Eamets.

With ever-improving technology, such as finger print and eye scanner identification, there is little hindering Estonia from adopting such a system. Cell phones can easily be used to pay back small sums borrowed from friends and to buy groceries from the local outdoor market.

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