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- Investors are stocking up on cash during the coronavirus pandemic, in some cases withdrawing thousands of dollars, The Wall Street Journal reported Wednesday.
- Large withdrawals have prompted banks and regulators to warn consumers that it’s a bad idea to take out a lot of cash right now. Outside of a bank, it’s more likely to be lost or stolen, according to the report.
- It could also contribute to the spread of the coronavirus — « a single dollar bill can be home to as many as 3,000 different bacteria and has changed hands upwards of a thousand times, » the Colorado Bankers Association said in a statement Wednesday.
- Read more on Business Insider.
As consumers panic amid the coronavirus, they’re stocking up on toilet paper and cash.
An uptick in large withdrawals — ranging from tens of thousands of dollars to as much as $250,000 at once — has depleted the cash reserves of some US banks and credit unions, The Wall Street Journal reported Wednesday.
The withdrawals have prompted responses from banks and regulators, which are now warning consumers against keeping large amounts of cash on hand at home, where it can be lost or stolen, according to the report.
Cash kept in the bank, on the other hand, is protected — deposit accounts at banks or federally insured credit unions are backed by the government for up to $250,000.
« Since 1933, no depositor has ever lost a penny of FDIC-insured funds, » the Federal Deposit Insurance Corp. said in a Wednesday statement.
There’s another big issue with taking out large amounts of paper money amid the coronavirus pandemic — cash and ATMs can spread germs. The virus can live on cardboard for up to 24 hours and up to three days on plastic and stainless steel surfaces, the BBC reported, citing a study from the US National Institute of Health.
That means that cash could be carrying the virus, and that consumers are potentially opening themselves up to germs by using ATMs with keypads or screens touched by many people.
« A single dollar bill can be home to as many as 3,000 different bacteria and has changed hands upwards of a thousand times, » the Colorado Bankers Association said in a statement Wednesday. « Keeping cash in the bank is a prudent defense against contamination. »
The CBA also encouraged consumers to use other forms of payment when possible, such as credit or debit cards, which can be easily sanitized.
In addition, the CBA said that consumers shouldn’t worry that banks will run out of cash, even during the coronavirus outbreak.
« Banks have more than enough resources to go around, » CBA President Jennifer Waller said in the Wednesday note.
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