Cashless Society

Introduction

With the widespread use of contactless payments, mobile payments and improvement digital banking structure, the use of cash is slowing. In the UK, 34 per cent of payments are now made in cash according to UK Finance. The use of debit cards has become the most popular payment method. As the use of the cashless payment methods continues to increase, the support of cash transaction becomes less affordable. Along with rising bank charges, disappearing branches, all these factors will certainly accelerate the transition towards digital payment methods. However, if the transition is too quick, this will leave a percentage of the population financially excluded and risk of exploitation; similar to the digital divide which is slowly narrowing as the percentage of the senior population gets to grips with digital technology.

Cashless Methods

Apple & Google Pay

Mobile payments via smartphone enables transactions to be made by tapping the smartphone on a contactless payment device

Contactless

Card enabled for contactless can be tapped on contactless payment devices

Amazon Checkout Free Grocery Store 

Amazon has been experimenting with checkout free grocery stories that take payment when you walk out the store.

Bitcoin

Digital currency mined using computers and allows payments to be made and governed digitally

Benefits

• Physical cash can be anonymous and untraceable, digital payments leave behind a traceable record

• Voice, face and retina recognition allows more secure payments

Weaknesses

• Digital payments are easily tracked that raises concerns about surveillance and privacy

• Technology is vulnerable to glitches, outages and mistakes leaving people without the ability to make transactions

• Increased risk of identity theft, fraudulent transactions and data breaches

Summary

As society continues to use contactless payments and slowly stop using cash, governments and banks will need to invest heavily in their digital infrastructure to ensure a robust system can operate 24/7 that individuals can always make secure payments but always prevent fraudulent transactions. Integration and implementation of digital payment technologies will need to carried out gradually and a robust backup system for those that struggle to access the technology and for situations where the digital payment technology fails. Countries such as China have taken the cashless society to a whole new level and integrated the technology in their social media.