The cash-free future is coming closer and closer. COVID-19 is a big catalyst towards the cash-free future we have always talked about. There has been a rise in contactless payments as more shapes are investing in the tap and pay technology.
It has become more convenient than ever to ditch cash and use contactless methods of payment when out. Yes, it is making it easier for everyone to spend but is it any good for us? Let’s find out.
The Shift To Contactless Payments
While COVID-19 was a catalyst of contactless payments, they have been on the rise for quite a while now. A study done by Mastercard in September 2016 found that more than 40% of the people in the UK viewed their smartphone as their preferred payment method. That is why we can see a decline in cash payments for the past few years.
Many retailers also predict that cash will be dead in the next five years, and there will be a complete shift to contactless payments. However, can cash be actually dead in our society? Let’s take a closer look.
The Case For Cash
There are many reasons that we may not see cash completely dying. These include:
1. Micro-Transactions
Unless you are living under a rock, you know what petty cash is. It is the money we use for small daily transactions. Such money can be used for emergencies, tipping a waiter, and many other things.
The use of petty cash is in our culture and these micro-transactions will be challenging to convert digitally. That is why petty cash still may be used in the future.
2. Black Markets
There is no concept of contactless payments in black markets. Cash is the only currency used in such markets for many reasons. As long as black markets exist, so will cash.
Digital methods always leave a paper trail, and that is why the concept of a black market will never work in a cashless society. So, we may not see cash ceasing to exist for a long time.
3. Leisure Activities
Cash will always be required in many outdoor activities such as amusement parks, playgrounds, and much more. The nature of these transactions and the location will make it challenging to carry out digital transactions. That is why cash will always exist for such activities.
Going contactless in such places will be a hassle for the organizers and the visitors. That is why cash may not be dead for a long time as we need a better system to shift to digital transactions.
Final Words
Contactless is making it easier for people to spend, but it is also encouraging unnecessary spending. However, the good news is that cash will not be dead for at least a decade or so. We still need it for many various transactions in various businesses.
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