Many believe we have been moving toward a cashless society in which all financial transactions are digital. Many financiers and government authorities favor bidding adieu to cash-- there’d be lower crime rates with no physical money to steal, financial crimes and money laundering would be much harder to commit if there’s a record of every payment you ever receive, we would save money by not printing bills and coins, people would have ease of use when managing their cash, and it would make international travel so much easier. You may be sold. The pros are pretty convincing, but there are many who are against this move towards a cashless society and say that many citizens would be extremely disadvantaged by this switch.
Many workers, such as tipped wage workers, still rely on cash to support themselves. The demand for digital offerings has led to less branches and ATMs, as well as easily accessible cash services. Some cannot obtain a bank account because they don’t have the resources to consistently maintain a bank account or they don’t understand the banking system. There are also many people who have been blacklisted by larger banks for failing a credit check or holding a record of financial indiscretions like overdrafts or bounced checks.
According to The World Bank, 1.7 billion adults globally do not have a bank account.3 While only a small fraction of that number comes from the us, still 18 million US citizens are unbanked3 and many more are underbanked, meaning they have a bank account but no credit, cannot afford fees or high interest rates, and/or do not have a bank branch in their community. Likewise, many members of the elderly population would also struggle with a digital system as many do not have access to smartphones or do not feel comfortable using digital offerings.
Aside from these people groups, there are more universal cons of going cashless. Cash may be easier to steal, but with the growth of hackers, digital systems are not entirely safe from data breaches and theft. In fact, if your bank account is drained by a hacker in a cashless society, you’ll have no alternative source of money. While technology is growing and improving, it is not without fault. Technology issues would leave you without access to your money.
While there are great benefits and conveniences associated with digital technologies, there is still a need for cash and cash services. It’s important, as we move forward with digital banking, to keep in mind all of our customers and make sure we’re not leaving anyone behind.