Daily Management Review

A cashless society won’t happen tomorrow

Global cash and currency experts met in Paris


05/06/2016


‘Do you trust cash as a mean of payment?’ Most of us have never asked ourselves this question as cash is deeply rooted in our daily lives; sometimes we use it without even noticing. Yet, behind all of our coins and banknotes there is a world of professionals who work to keep cash secure and accessible to all of us. Many of these professionals met in Paris in April to discuss the future of cash. If you believed that your banknotes were slowly disappearing, you are probably mistaken.



The conference opened with some representatives from the host country, France, which is more cash friendly than many of its Europeans neighbors. ‘In the past four years, cash has been more dynamic in France than in the general Euro zone’ said Alain Gerbier of the Bank of France. Cash in France is strong. According to Gerbier, the best sign to see its stability is to ‘follow the ATM withdrawals which are quite stable throughout France. That is why we are confident in the future of cash. We do think that cash will survive if it’s more stable and more efficient.’
 
The conference largely focused on how to make cash and currency more stable and efficient. Printing security banknotes is an art that is getting increasingly harder to counterfeit. The amount of security put into these banknotes has never been seen before. People trust cash today as much as they have throughout history, while other means of payments don’t necessarily have the same success. ‘The means of payments of today won’t have last as long as cash has already’ said Doris Schneeberger from the European Central Bank (ECB). There are one trillion Euros in circulation today and still ‘the demand is really strong’ she said.
 
It is impossible to know the exact number of cash transactions as by nature they are un-trackable but some 80% of the Point of Sale (POS) transactions are done in cash today.
In 2014, the value of all card transactions was 1.3 billion Euros, and the value of total ATM withdrawals summed up to 1.1 billion. Cash can be used many times over, often for many years, cash is still far ahead of cards.
 
In the U.S, ‘cash is the most used method of payment in terms of total transaction amount’ said Joshua Opatz from the U.S Federal Reserve System. ‘The amount of currency in circulation has grown consistently since the 1980s,’ he added. In 2012, the average American would hold $55 in cash with him; today that has increased to over $60 and ‘cash demands continues to grow overall’ said Opatz.

Cash usage is so ‘normal’ that people may not even realize when they use cash. People may believe that they use less cash but in fact they use more than before as it’s so easy to forget when and where we use it. Cash remains the most convenient method of payment and that’s why all the Central Banks representatives are ‘investing in cash.’ The Bank of France is building new facilities; the Bank of England is replacing its old bills with polymer banknotes; the U.S is redesigning its most used note - the $20 bill. Cash is in the heart of the news.
 
Even in the countries that tried to get rid of cash by slowly removing ATMs and making it more and more difficult for users to use cash, we see that cash remains crucial. In Finland, 73% of all retail payment are made using card payments. ‘Cash is down to 13% but yet it’s far from being considered a fallback’ said Päivi Heinkkinen, Chief Cashier at the Bank of Finland. But today more and more Fins are afraid of seeing their cash disappear, and having all their purchases tracked and recorded, with payment made more difficult in some remote areas. People are also worried about a big system shutdown that wouldn’t allow you to pay with your card or cellphone anymore. ‘It happened in Belgium in 2013, on Christmas Eve. It could happen anywhere and that’s why people trust cash more than they will ever trust their cards’ said Heinkkinen.
 
‘The Future of Cash’ seems certain and professionals are confident that if they continue to find ways to make it more stable and reliable cash won’t be replaced. The way you get cash may change. For Kabir Sehgal, author of ‘Coined,’ bitcoins are nothing new; they are the same as what Native American tribes used in the early 1900s where ‘an assembly would write down the trade, so that everyone knows and has records of it, just like the bitcoins today’. However, he said we might soon have cash directly delivered to us. ‘I’m thinking about a cash Uber, where cash on demand is brought to you where you are through an app.’ Developers are already working on it - more proof that cash still has good days to come. 


*Nils Aucante is a Journalist and Documentary Director based in New York.







Science & Technology

With China Set To Dominate, 1 Billion Could Be Using 5G By 2023

Deutsche Telekom unveils next gen 5G mobile antennas in Europe

Diamonds are now the new gold

Expert Body Says Driving In A Driverless Car In An Inebriated Condition Or On Drugs Should Be Legalized

SEC’s EDGAR database vulnerable to cyber threats

Research Says The Risk Of Severe Turbulence On Planes Will Increase Due To Climate Change

Barclays and CLS Group aim to replace SWIFT with blockchain

Designing Of Cars Being Done With Hologram Goggles At Ford

The Already Surging Cyber Attacks Are Set To Rise Even Further, Says A Study

Chinese to equip smartphones with OLED displays

World Politics

World & Politics

Scholar Says Political Appointees Not As Important As Financial Ones In China For The Economy

An Expected Change In Brussels Could Be Crucial For The Euro Zone

Destroying People Who Wouldn't Help One Of His Bankrupt Businesses Was All Trump Talked About When He Met Him In 1990s: Branson

Russia Is Worried About America’s Unpredictability

No oil contracts with Iraqi Kurdistan: Iraq’s oil ministry

Donald Trump lost $ 600 million during his presidency

Britain puts its weight behind Europe in the battle between Boeing and Bombardier

EU hopes to keep the Iran nuclear deal afloat