Joshua is a technology enthusiast who is intrigued by how our society is changing because of that technology
The coronavirus crisis has accelerated the death of handheld cash. The progress which would've taken years has now been accelerated by the crisis and has occurred in only months. ATM transactions have declined by 62% and even with the re-opening of businesses, there has not been much of a bounce-back for cash.
As businesses have begun to shun the use of cash in their stores due to health concerns about the spread of bacteria on banknotes and coins, cash usage has plummeted. Consumers have also become much more aware of these sanitary risks when it comes to handling cash, and so many have stooped using it in favour of mobile wallets or credit cards.
As these payments have become more widespread many consumers (who would have continued to use cash if not for the crisis) do not plan to go back. The crisis has proven the efficiency and convenience of technologies such as NFC (near field communication) in mobile transactions through apps such as Google, Apple or Samsung Pay.
Perhaps the beginning of the end for the plastic too?
According to a poll conducted by Harris interactive 66% of Americans believe that smartphone payments will eventually replace physical cards. And on top of that, just recently Google just announced that 8 banks will now allow for a digital-only account, meaning cards are not needed to set up a payment and rather your details will automatically be on Google Pay.
If this idea becomes more widespread, and the other mobile payment apps follow suit, it could accelerate the death of credit cards. Furthermore, ditching credit cards could also serve an environmental purpose by helping to cut down on plastic waste by reducing excess plastic in landfill sites.
Mobile payments are fast, more convenient, and (unlike cards) do not have a contactless limit. And it is the lack of a contactless limit that may be the ultimate advantage in my opinion. I mean, cmon, £45 limit? Really?
There is one big downside to a cashless society and that is in all likelihood many older people in our society prefer to use cash and find it easier to do so. Not only that, but many people do not have access to a bank account. They are known as the "unbanked". The unbanked mostly consists of the poor, the elderly, and undocumented immigrants (who cannot open an account due to not having the required documents). The unbanked would be left behind in a cashless society and would struggle to get by. Sounds like a situation most governments would want to avoid.
The less fortunate in our society rely on access to cash to stay afloat. many decide to "put some cash aside" to save for when the cash is needed. However, if that money was to be digital, that money could be taxed and withdrawn. Then you have the issue of penalties for overdraft fees which, in many cases, compiles debt for those unable to repay the amount owed.
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Big Brother is Watching...
As you probably know, any digital system can be monitored. So imagine this. Every transaction you make, every single piece of money in your account, is monitored. Big Brother knows what you bought and when. Scary thought, right?
The cashless society would just be but another tool for any government to use to monitor its citizens. In a world where privacy is becoming a thing of the past, well, coincidentally so is cash.
Whilst many people may say information compiled from monitoring transactions may prevent, let's say, the purchase of a weapon by someone on a watch list. Or maybe they may notice a disturbed young boy showing signs of mental illness buying a gun in order to commit a school shooting. these are all valid points, but they still require everyone's privacy to be compromised.
So perhaps cash may be the thing stopping Big Brother from extending its watch to the financial sector. That's something to think about.
A cashless society promises a world of limitation, control, and surveillance - all of which the poorest Americans already have in abundance, of course. For the most vulnerable, the cashless society offers nothing substantively new; it only extends the reach of the existing paternal bureaucratic state
— Sarah Jeong, former member of The New York Times editorial board
Be Careful What You Spend!
Have you ever just swiped your card to pay for an item without checking the price? Many of us have, and it can lead to some irresponsible spending habits.
Without having physical money in your hand it is not as easy to grasp to value of money. Paying for items in today's society feels like just swiping a phone or a card, you don't actually see how much money you have left or how much you are spending in the process of buying the items(s). Therefore, money becomes more abstarct because you disassociate yourself with how much you may be spending (a lot of the time you don't know how much you've spent!).
When start to spend more than they have through "by now, pay later" credit accounts, they start to accumulate debt. And it's common sense knowledge that being in debt is not a situation individuals want to find themselves in. No matter how profitable consumer debt may be to the banks.
And at the end of the day, it's all about the banks, isn't it? Making money from debt, encouraging irresponsible spending, and cutting costs.