Effect of financial access on cashless economy: The case of Ukraine

  • Received December 6, 2022;
    Accepted December 29, 2022;
    Published February 17, 2023
  • Author(s)
  • DOI
    http://dx.doi.org/10.21511/bbs.18(1).2023.08
  • Article Info
    Volume 18 2023, Issue #1, pp. 91-102
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This work is licensed under a Creative Commons Attribution 4.0 International License

The pandemic and wartime in Ukraine confirmed the importance of cashless payments for financial stability. The purpose of the paper is to examine the effect of technological infrastructure and financial access factors on cashless economy development. The impact of the infrastructure factor is assessed in case of Ukraine, using NBU’s data on payment infrastructure during 2001–2022. The hypothesis of the boosting effect of financial access towards a cashless economy has been tested using the method of correlation between M0/M3 and different indicators of financial access (usage of essential technologies, financial services) based on data of World Bank, IMF, and Triple-A in 2021.
The study’s results show that globally there is an almost linear relationship between the number of open financial accounts and the increase in the level of cashless (0.954). It is also revealed that the rise of the share of the population making electronic payments decreases the share of cash in the economy. It is determined that the spread of the crypto-assets has a significant impact on the reduction of cash in the economy (an increase in the share of the population operating with cryptocurrencies by 1% reduces the share of cash by 0.5%). Regarding regulatory policies, it is proposed to stimulate the coverage of the population with open financial accounts, making mandatory payments with electronic payment systems and developing their infrastructure.

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    • Figure 1. Types of payments in Ukraine, 2000 – November 2022
    • Figure 2. Ukraine’s payment infrastructure, 2001 – November 2022
    • Table 1. Correlation matrix between factors
    • Table 2. Regression parameters
    • Conceptualization
      Yevhen Bublyk
    • Methodology
      Yevhen Bublyk
    • Project administration
      Yevhen Bublyk
    • Supervision
      Yevhen Bublyk
    • Investigation
      Yuliia Shapoval, Svitlana Brus
    • Validation
      Yuliia Shapoval, Oleksii Shpanel-Yukhta, Svitlana Brus
    • Visualization
      Yuliia Shapoval, Oleksii Shpanel-Yukhta, Svitlana Brus
    • Writing – original draft
      Yuliia Shapoval
    • Writing – review & editing
      Yuliia Shapoval, Svitlana Brus
    • Data curation
      Oleksii Shpanel-Yukhta, Svitlana Brus
    • Formal Analysis
      Oleksii Shpanel-Yukhta
    • Software
      Oleksii Shpanel-Yukhta