The Cashless Revolution: Creeping North?
A cashless society has become something of an ideal. Proponents claim that it’s safer, more convenient, and cheaper to move money around in a world without coins but critics say that it risks leaving some people behind. A cashless society may be inevitable, even as notes featuring King Charles enter circulation, but just when will we have no more coins for our piggy banks?
China continues to serve as a case study for a completely cashless nation. A report from TheConversation website claims that 98% of Chinese shoppers prefer to pay by smartphone. People are “happier” that way, it added, back in March 2023.
The data might not be as useful as it seems. China doesn’t always give its citizens much of a choice regarding essential tasks, routing some things – like shopping, taxis, and social media – through its WeChat app.
From a Western perspective, this is exactly what Elon Musk envisioned for Twitter, now X, a project that hasn’t progressed in quite some time.
Source: Pexels.
Newcastle is a long way from China (quick fact: the .gov website for Newcastle lists the country’s Hainan Province as among its international partnerships) but technological revolutions, like a cashless society, never exist in isolation.
Put another way, while the dismissal of ‘proper’ money might be exaggerated, it’s not going away.
Cost of Living
Payments processor Dojo reports that the percentage of contactless transactions (i.e. not using a PIN) increased by 1.7% between July 2021 and June 2023, from 93% to almost 95%. This needs some explanation. The info only looks at different types of card payments, ignoring cash altogether. Yet it’s clear that shoppers are separating themselves from contact even here.
A much more enlightening figure comes from research company UK Finance, which claims that cash usage slumps 17% each year – and has done so since 2017.
The true percentage of people keeping cash alive in the UK comes from Reuters. Just 12% of payments were made in the old-fashioned way in 2023, a record low.
The BBC mentions one apparent contradiction to the previous. In a brief fling, the use of cash in the UK saw a hike in 2023 due to the spiraling cost of living, now abated.
“No Point”
Online shopping may be behind the surge in contactless transactions. There are more ways to pay than ever before and this is how some businesses live or die. Review website FreeBets insists there’s “no point” joining a gaming site that takes a long time to make deposits and withdrawals and doesn’t list them among its casino offers.
Source: Pexels.
This might seem common sense but online businesses and their customers have to deal with variables like cross-border fees and currency exchange rates.
This brings us to one of the reasons why China has started to walk back its cashless plans – tourism. Visitors were locked out of its payments network by default but can now create a bank account in the country to buy things.
There are rumblings of dissent in Newcastle.
In October 2023, the City Council began switching parking meters over to cashless payments, starting with Eldon Square and Eldon Park. This effectively locked out people who only carry cash, largely elderly and low-income people, according to a report on the topic from the BBC.
Privacy
One thing that sometimes gets left out of conversations about a cashless society (and one of the reasons why it might be problematic) is privacy. Cash withdrawals at ATMs can be tracked but card payments mean a person’s movements can be followed whenever they make a transaction. This isn’t possible with notes and coins.
Newcastle College does make an exception for cash in an “emergency” and seemingly only at canteens at Riverside Dene and Trevelyan.
With all these things in mind, there’s a feeling that cash can’t leave us.
An article from the Bank of England in 2019 hinted that ‘real’ money wouldn’t be going away any time soon – and, when cybersecurity firm Cloudstrike managed to disable the world’s payment systems in late July, its opinion seemed all the more sensible. Manchester United, Heathrow, Wetherspoon, and British Airways were just a few of the British victims.
How does a completely cashless society survive a technological bugbear when no safety net – like cash – is in place?