The landscape of the financial system in Colombia is characterised by a permanent updating and modernisation of the means of payment available to users, thus presenting more and more options, both cash and digital.
Financial options such as electronic deposits, savings accounts, debit and credit cards, and even digital payment platforms are becoming increasingly popular in the country.
The variety of payment options has meant that consumers have various alternatives for managing their finances, and it is no coincidence that, for example, retailers and their customers are increasingly using these technologies to make and/or receive payments.
According to the Banco de la República, in its survey on the use of payment instruments in Colombia 2020, cash led with 88.1 % as the most used means and by 2022, the same entity reported that the use of cash was reduced to 78.4 %, a percentage that was mainly replaced by payment with electronic transfers with 15 %, and debit cards with 8 %.
While indicators from past years show a strong acceleration in the transition to digital means of payment, especially driven by the Covid-19 pandemic and the need to look for contactless payment options, 2024 has slowed down the trend that had been occurring.
The Banco de la República revealed that by 2024 cash continues to lead as the most used payment instrument in daily consumption with 77.8%, and although this figure is lower than the one presented in the 2022 report, the trend in the decline of cash use has slowed down significantly in recent times.
Challenges for digital payments access in Colombia
Among the main challenges for the expansion of digital means of payment in Colombia is the lack of access and technological familiarity in some sectors of the population.
Connectivity problems in rural areas and low financial literacy prevent many citizens from adopting these alternatives more frequently.
In addition, distrust of digital systems and fear of fraud remain common concerns among users. According to the Banco de la República, it is estimated that approximately 32.5% of the population in Colombia does not have access to any financial product, highlighting the existing gap, particularly in cities such as Cartagena and Valledupar, where almost 50% of the population lacks these services.
Beyond the technological barriers, cash remains the preferred means of payment for many Colombians, not least for practical reasons.
On the one hand, cash payments allow immediate control of personal and household budgets, especially for those with low or intermittent incomes.
According to the results of the survey on the use of instruments for regular payments in Colombia 2024, 87.5% of people with incomes below one minimum wage prefer cash for their daily transactions, as it facilitates the handling of small amounts without the need for bank intermediaries.
Also, the use of cash remains essential for small transactions and everyday purchases, where the ease and speed of use outweigh the perceived benefits of electronic payments.
‘A hybrid model that combines the use of cash with digital transactions not only responds to the current needs of the Colombian market, but also fosters financial inclusion. It is essential that means of payment evolve without leaving aside those who depend and rely on cash for their daily transactions, thus ensuring a gradual and efficient transition to a more digital system’, said Andrés Daza, CEO of Prosegur Cash.
In that sense, a hybrid model that combines the path demanded by the digital era marked by digital transactions and that allows for the continuation of cash movements rooted in cultural behaviours and consumption preferences of people at all levels and regions of the country remains an efficient solution in Colombia.
While the use of electronic transfers and debit cards continues to gain ground across Colombia, cash continues - and will continue - to play an essential role in the daily activities of millions of Colombians.
This balance between digital and physical allows for greater flexibility and accessibility, adapting to the different needs and capacities of the population, which reinforces the importance of keeping both systems in place.
Source: Valoraanalitik