2  6  margin between the cost of banks’ short-term funding and the interest that bank charges on long-term lending – which is the main driver of bank profitability. This, combined with an effective lower bound on nominal deposit rates, may weaken bank profitability.
All actors in the cash cycle need to work together to ensure that handling and distributing cash remains efficient in terms of costs. What does this mean? With the diversity of payment options increasing, their underlying cost structures are coming under greater scrutiny. Measuring these reliably is not an easy task, but we have to try nevertheless.