I recently wrote a couple of posts, here and here, about how we are moving to an essentially cashless society and the problems and backlash it’s bringing. The TL;DR is that it’s now possible to live your life pretty much without handling actual cash—I know I do—and that many merchants started adopting a “no cash” policy. Those policies were met with resistance for a variety of reasons that are discussed in the two posts.
Having written those posts, I keep seeing, in accordance with Baader-Meinhoff, articles about going cashless and the backlash against it. The latest is a CNBC article on PayPal CFO John Rainey who says that the death of cash has arrived. It was killed, he says, by the rise of digital payments and smart phones. PayPal sees itself as a enabler—through such services as Venmo—of the new cashless society.
If you recall my previous posts, you know that the principal argument against a cashless society is that many poor people don’t have access to banks1 or credit cards. Rainey notes that 70% of these people do have a mobile device and says that PayPal is going to solve the cashless problem by bringing the power of a bank branch and its financial services to those devices. It’s not clear from Rainey’s remarks exactly how this would work without a bank or bank-like institution holding the funds to be transferred. It will be interesting to hear more details.
Footnotes:
As soon as Irreal achieves world domination, use of the term “unbanked” or any of its derivatives will be a capital offense.