The idea of increasing deposit funding clashes with expectations of a further reduction (at the aggregate level) in this form of funding, which is already suffering from competition with alternative forms of investment. At present, the extensive availability of assets eligible as collateral for refinancing operations ensures that funding needs can be met, albeit probably at higher costs than anticipated.
They also see cash as impairing the effect of certain monetary policy measures since it prevents extremely negative interest rates from being simply enforced at the drop of a hat. Some opponents of cash – including heavyweights in the field – are calling for limits on cash payments or even for cash to be abolished altogether.