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Is it Viable to Have a Cashless Society?

In most countries around the world, cash is still the most accepted form of payment. In America 70% of retail transactions are still made with cash, according to a recent study by the Pew Research center, but in some countries, Sweden for example, only 13% of transactions are paid this way.

The rising trend of cashless transactions is definitely upon us, but certain retail stores are trying to impose it faster than most people are ready for. Meanwhile, many are ready to embrace a cashless society, but there are many people who believe that this is new level of discrimination.

The debate around the whole issue started a while back, but flared up again recently when Amazon Go decided to stop allowing cash in its stores, as did the Mercedes-Benz Stadium in Atlanta. This issue has been debated warmly by many, including merchants, advocates of a society without cards and those who have access to both cash ad cards.

According to the FDIC, at least 15.6 million people in the U.S. do not have a bank account, meaning that they pay for purchases and accounts with cash. Since the majority of these seem to be those with lower incomes or immigrants, their proximity to banking institutions seems to be the major reason why they prefer cash. Many of these people rely on cash that the get from pay day loans or pawn shops. Their access to cash is about to get even worse, with Bloomberg reporting that JP Morgan Chase recently closed branches in low-income areas.

Policymakers in Philadelphia have decided to take a stand and have recently passed a ruling, which will take effect in July this year, where a business which doesn’t accept cash can be fined up to $2,000. Many other cities are thinking of imposing similar laws to protect consumer choices. Considering that most cities in the U.S. also attract a large amount of tourists, it has to be taken into consideration that they might prefer cash.

One of the positive aspects for most business to have cashless transactions is their increased speed and profitability. The money saved by not employing cashiers, most businesses argue, can be spent on security or risk thefts. The speed at which card transactions go through, they say, means more sales and handling cash has become costly because of the need to count cash and daily deposits.

On the other hand, businesses pay for card transactions in the form of merchant fees to the banks, shaving off two to three percent from their profits. The downside of credit card transactions to consumers is that they often spend more than what they can afford.

Moreover, a cashless society depends heavily on technology and in the event of a system fail, no transactions would be able to be completed.

Atlanta stadium installed cash-to-card machines to placate supporters and a food establishment  in Boston which specializes in a “start to finish” robotic experience has had a  optioned installed on its touch screens, where orders are placed and payments made and clients can call a manager to make cash payments.

Innovation in technology and the way we do business has changed our lives in a positive way, but we cannot allow it to be at the expense of others less privileged than us. Business has an obligation to respect the consumer, and in this cast to respect their preferred method of making their purchases.

SnatchBot

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