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Russians hoard cash over Covid-19 fears

Russians hoard cash over Covid-19 fears

Russians have responded to the Covid-19 pandemic by stockpiling cash, withdrawing more physical money from ATMs and bank branches in the last few weeks than in the whole of 2019.

Concerns that banknotes can be contaminated with the coronavirus have led to a surge in contactless payments around the world. In the UK, cash usage halved in just a few days following the government's imposition of a nationwide lock-down on freedom of movement.

However, in many countries people are responding to the crisis by hoarding cash, fearful that they may at some point be unable to access their money.

According to central bank data, first reported by Bloomberg, about a trillion rubles ($13.6 billion) has been issued from cash machines and bank branches in Russia since the beginning of March.

The country has been seeing spikes in withdrawals after announcements from President Vladimir Putin, such as when he extended self-isolation rules.

The rise comes despite a move by Russian authorities last month to limit the number of banknotes in circulation and push consumers into using digital payments.

A similar picture is emerging in Europe, where the value of euro banknotes in circulation recently saw the largest increase since the 2008 financial crisis. As first reported by the Financial Times, in the four weeks to 10 April, the value of banknotes distributed rose by EUR41.2 billion to EUR1.33 trillion.

In the US, cash circulation has seen the biggest jump since late 1999, when people began hoarding money over fears about the Y2K bug.

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