Cashless Payments and the “Better Way” Initiative in Focus of the New Episode of NALED’s Podcast Reform Stories
The latest episode of NALED’s podcast Reform Stories focuses on cashless payments and the “Better Way” initiative. Dušan Vasiljević from the Competitiveness and Investments Department at NALED, Rastko Nicić, Member of the Executive Board of UniCredit Bank, and Zlatko Milikić, Public-Private Partnership Project Advisor at GIZ, discuss how cashless payments are transforming the way businesses operate, why the most developed countries rely less on cash, and whether cash is truly “king” or if cards, mobile phones, and other forms of electronic transactions are safer and more beneficial for consumers.
As highlighted in the podcast, paying with cash is far from “free.” From the banks’ perspective alone, cash management entails millions in annual costs – from video surveillance, physical security, and secure cash rooms to armored vehicle transport and insurance. “Someone ultimately pays for all of that,” noted Rastko Nicić, adding that electronic transactions are simpler and less expensive because they do not require complex physical infrastructure.
The speakers also referred to international research. In Sweden, it was found that a single cash transaction has up to 15 times greater negative environmental impact compared to a cashless payment, while the overall socio-economic cost of using cash is significantly higher.
The role of cashless payments in combating the shadow economy was also emphasized. According to data presented in the podcast, the share of the shadow economy in Serbia decreased from nearly 30% of GDP in 2013 to 21% in 2023, alongside a steady increase in the number of citizens regularly using cards and electronic transactions.
Launched in 2021 and supported by partners from both the public and private sectors, the “Better Way” initiative has enabled the introduction of around 10,000 POS terminals among small businesses. More than 85% of users continued to use them even after the subsidized period ended, Milikić and Nicić recalled.
The podcast also explores the true cost of cash, who ultimately bears these costs, the impact of cashless transactions on reducing the shadow economy, how the “Better Way” initiative contributes to financial inclusion in Serbia, and what new subsidies for small businesses are being prepared in the next phase of the POS program.
The full episode is available on NALED’s YouTube channel.
