Do you remember the last time you carried around notes or coins in your pocket or this day seems to be really hard to remember? Although cash is still important around the world, Europe is already moving away from it and Sweden is a great example of dropping cash. The percentage of using cash for recent purchases in Sweden has dropped from 40% in 2010 to 13% over the period of eight years (Savage, 2019). Especially in bigger cities of Sweden, going without cash seems to be the norm, as all the purchases happen to be in the form of digital transactions by either card, online or the Swedish mobile payment app Swish.
It is not of a surprise, since operating in cash costs countries around 0.5% of the GDP every year, however, this is not the only reason. Not only is the demand for a fast method of payment growing, especially among the young generation, but also it is easier for the government to monitor tax division (The Economist, 2019). Business owners in the USA recognize the same trend and respond accordingly in an effort to boost operating efficiency, reduce waiting time for customers as well as create a proper work environment by eliminating the risk of theft. An example of such is the Amazon Go stores where cashiers are replaced by computer vision technology to record the selection of customers’ purchases and then automatically charging their cards (Santana, 2019).
On the contrary, Germany does not find plastic payment so attractive as other European counties by having 80% of all “point of sale” transactions made with cash in 2016. “Cash-only here” or “No cards please, we’re German” are the phrases you would hear often about Germany. Hence, paying with card – debit or credit – is not as obvious as everyone might expect from one of the most powerful European economy (Deutsche Welle, 2019).
The problem of inconvenience seems to be solved when with one scan or click your purchase is being made, but how about privacy? Electronic money trails allow government and private companies to access and harvest customers’ personal data and not everyone would like that. Yet the invasion of privacy by both parties might step aside when it comes to a bigger concern – cyberattack (The Economist, 2019). Working hard and exploring how the country could handle digital payments, Sweden’s central bank is testing the e-krona, a new state-issued digital currency independent from global payment systems, that hopes to be less vulnerable to cyberattack (Savage, 2019).
The cashless trend is upfront but are we ready yet for a cashless future?
Cryptowisser, (2019). [image] Available at: https://www.cryptowisser.com/cryptocurrency-merchants/ [Accessed 8 Sep. 2019].
Deutsche Welle (2019). Times change but German obsession with cash endures | DW | 10.05.2018. [online] DW.COM. Available at: https://www.dw.com/en/times-change-but-german-obsession-with-cash-endures/a-43718626 [Accessed 8 Sep. 2019].
Santana, S. (2019). Is the U.S. on Its Way to Becoming a Cashless Society? [online] Harvard Business Review. Available at: https://hbr.org/2019/07/is-the-u-s-on-its-way-to-becoming-a-cashless-society [Accessed 8 Sep. 2019].
Savage, M. (2019). NPR Choice page. [online] Npr.org. Available at: https://www.npr.org/2019/02/11/691334123/swedens-cashless-experiment-is-it-too-much-too-fast?t=1567958567607 [Accessed 8 Sep. 2019].
The Economist (2019). What does a cashless future mean? Available at: https://youtu.be/-0ph-pvCSPc [Accessed 8 Sep. 2019].
