PAYMENT DIGITALIZATION IN RESPONSE TO THE CHALLENGES OF A CASHLESS SOCIETY

Abstract

Payment digitalization, as reflected in the topic of this paper, represents one of the key transformations with significant implications for improving the financial system and fostering economic growth, while responding to contemporary trends. The paper focuses on the process of payment digitalization through three sections, which directly affect complementarity and practical developments in the economies of Serbia and the Western Balkans. The findings indicate that Serbia and the Western Balkans lag behind developed European economies, and that cash still dominates as a method of payment in our region. This is corroborated by our field surveys conducted in Serbia and Montenegro (Kraljevo, Plav and Rožaje). These results are further complemented by a comparison with the prevalence of digital payments globally and within the EU. The study suggests that, without coordinated actions at all levels - from financial institutions to citizen education - the transition toward a cashless society will remain constrained, despite its potential to deliver innovations in security, privacy and inclusiveness.