People and businesses could be better prepared for disruptions to cash and payment services
The Estonian Payment Forum held a discussion last week organised by Eesti Pank on access to cash and payment services in an emergency. The banks in Estonia are considered to be well prepared for a crisis, but it is very important for businesses and people to be ready as well, by making sure that their identification systems for ID cards, Smart ID and Mobile ID are in good working order, and they have a small amount of cash in reserve.
“The banks in Estonia look after the operation of payment services, but it is equally important for people and companies to take steps to be ready for shorter disturbances and also for longer ones”, said Rainer Olt, head of the Eesti Pank payment and settlement systems department. “Businesses should consider for example how they will accept card or cash payments if their cloud-based till services do not work. They should also think whether they have access to the information they need to pay wages and make other important payments in an emergency, so that they can make the payments in an actual bank office if the internet bank or other digital channels are not functioning”.
Mr Olt suggested that people could be prepared by making sure they have enough access to payment services in an emergency.
“Having multiple different ways of proving identity and confirming payments can really help in a crisis”, he said. “Although we are used to using modern digital payment solutions every day, by paying with our mobile phone and Smart ID identification for example, it is wise to keep a traditional plastic bankcard somewhere to hand and ready to use, and to know the PIN code for the ID card and have an ID card reader available just in case”.
“It is also worth activating the biometric self-identification solutions of the banks in a smart phone as an additional option”, he pointed out, adding that it is important to be aware that the level of services in an emergency may not be the same as usual, as payments do not always move as fast during a crisis, and maximum limits might apply to the size of payments. It is very important to be aware that fraudsters are very active when there is a crisis, as has unfortunately already been shown by the Covid pandemic and the war in Ukraine.
If communications and electricity are interrupted, there may be no alternative to cash. People in Estonia have good access to cash, as 99.5% of the people in Estonia live within 15 km of a point where they can withdraw cash. The number of ATMs has fallen in recent years in Estonia, but an alternative is provided by some 700 shops across Estonia that allow cash withdrawals.
“Estonia stands out within Europe because most purchases in shops are made by bankcard and it is quite common for people not to carry cash in their wallets, but they should still have enough cash to be able to manage if card payments are interrupted for a short time”, emphasised Rait Roosve, head of the cash and infrastructure department at Eesti Pank. “They should think about what their family spends on consumption, and it would be wise to keep a week’s worth of cash in reserve at home to guard against a longer-lasting crisis”. Mr Roosve added that Eesti Pank is ready in exceptional circumstances to provide cash for payments by the state and public sector, and that the central bank has sufficient cash for this.
“In the very worst case scenario where ATMs can no longer issue cash, it is important to know that there is sufficient cash within the territory of Estonia for people to make essential purchases, but it may take longer than usual to deliver that cash and provide access to it. Local authorities have a particularly important role to play in an emergency in organising cash in rural areas in particular, as they know the local conditions and options best of all, and the habits of movement of people living in the area”, he said.
Head of the crisis management department at the Ministry of Communications and Economic Affairs Priit Saar emphasised the importance of cooperation in an emergency, pointing to the example that the critical ATMs of the banks are located in shopping centres, and those shopping centres ensure not only the electricity supply for the ATMs, but also a place to access medicines and food.
The members of the Estonian Payment Forum are the banks and other payment service providers operating in Estonia; users of payment systems; stakeholder representatives including the public sector and business and trade organisations; and infrastructure companies. The Estonian Payment Forum works with market participants to support the development of the Estonian payment market and its adjustment to changes in the international payments market. The forum has operated since 2012 and is led by Eesti Pank.
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