Even Tech-Savvy Netherlands Struggles To Adapt To Digitisation

February 1, 2023
Considered one of Europe’s leading and innovative payments markets, new research conducted by De Nederlandsche Bank reveals that millions of Dutch citizens are struggling to get to grips with digital payments.

Considered one of Europe’s leading and innovative payments markets, new research conducted by De Nederlandsche Bank (DNB) reveals that millions of Dutch citizens are struggling to get to grips with digital payments.

Some 2.6m Dutch people aged 18 and above struggle with their digital payments and other banking affairs, a DNB study has revealed.

Although most are able to manage their everyday payments in shops independently, they are less autonomous when it comes to infrequent actions such as opening a bank account or blocking a debit card, the research suggests.

The study revealed that more than a million citizens rely on support from others to help with actions such as activating a payment method, internet banking, depositing money and withdrawing money.

One in six Dutch adults do not do all their banking on their own, the DNB suggests. Although most of them do perform everyday actions such as checking their bank balance and making payments in shops, many have difficulty operating devices such as ATMs, point of sale terminals and smartphones.

Meanwhile, these adults can fail to understand texts and instructions because of overly complicated language, have difficulty remembering codes or experience stress when performing actions under time pressure.

Among them are people who have difficulty reading, people with physical or learning disabilities and migrants who have difficulties with the Dutch language, the DNB said.

“Financial services should be accessible to everyone. That is of great importance for the inclusive society that we are striving for together,” said Medy van der Laan, chairman of the Dutch Banking Association (NVB), in response to the study.

Almost everything can be arranged via an app or online, van der Laan said. “The advantage of this is that many people now have easier access to banking matters, for example through spoken text or the use of a fingerprint or facial recognition.”

“Yet we also see that part of society cannot keep up,” van der Laan, a former government minister, acknowledged.

Access to cash

The DNB also raised concerns around access to cash withdrawals.

For example, the central bank warned that ATMs are often too high for people in wheelchairs or mobility scooters, meaning they cannot reach the keys. It also noted falling availability due to the rampant closures of bank branches and ATMs, a theme common across Europe.

According to the central bank, in the ten-year period ending 2021, the total number of bank branches in the Netherlands fell 38 percent to 1,928.

“This means being able to ask a bank employee for assistance to make payments is gradually becoming a thing of the past,” the study says.

The rise of mobile banking apps is another issue that the DNB has highlighted.

For example, although many customers greatly benefit from using mobile banking apps, specific groups in society struggle with them.

Some people do not understand the texts in the app because they do not understand all the words or are not proficient in the Dutch language.

In addition, visually impaired people cannot read the text very well because the characters are too small for them, and there are also people who cannot perform the necessary actions on their smartphone due to their limited hand function.

Nevertheless, financial institutions in the Netherlands are taking action to solve some of these issues, the DNB suggested.

For example, there are financial care coaches and advisors who visit customers, as well as service points where customers can go for support with physical or online banking.

However, the DNB warned that there is a lack of awareness here, which means that those who are vulnerable are struggling to access support from financial institutions.

Cash’s growing post-COVID importance

Many of the EU’s regulators and trade associations have been attempting to deal with the fallout from the accelerated drift away from cash since COVID-19.

Although the Netherlands is one of the most digitised markets on earth, like many of its European neighbours, policymakers are dedicating more and more resources to ensuring cash remains a viable solution and easily accessible for those who want it.

The access to cash debate has been prominent in the UK, where the ruling Conservative Party has made commitments to ensure it remains a payments option, while countries such as Spain and Sweden have introduced cash payment laws in recent years.

Even at EU level, it has become a more significant feature of policymaking even while acknowledging the growing preferences for digital payments. The European Commission, for example, is likely to include cash-related legislation as part of its digital euro proposals.

A study published in January by the Bank of Lithuania found that three quarters of residents would give priority to non-cash payments, up from 50 percent in 2021.

Despite this preference, 96 percent said they still use cash in their daily activities, up from 92 percent in 2021.

The DNB study also outlines that there are bank customers who do not want or cannot use digital options.

This subset of customers do not trust digital tools or are afraid of making mistakes and losing money as a result.

Others, meanwhile, find it too complex or do not have access to the internet.

For these people, the DNB has cautioned that “it is very important” to know that non-digital services such as cash, paper bank statements and transfer forms remain available.

Banks and other organisations in the country have made agreements to preserve cash.

The aim of the agreements is to ensure that cash continues to function properly as a means of payment at the point of sale in the face of a steady increase in electronic payments.

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