Irreal

Surprisingly, to me, my post on the trend to becoming a virtually cashless society generated a lot of interest and comments. Given my nearly unblemished record on being unable to predict how popular a given Irreal post will be, I probably shouldn’t have been surprised. In any event, the interest prompted me to look into the trend a little more.

Back in May, CBS did a report on the backlash to going cashless. It’s not just the politicians. Many customers also object to having an establishment refuse to accept cash even if they do have a credit card. Some of that’s a concern for privacy and some of it’s probably just the typical American crankiness about being told they can’t do something they’ve always done. The biggest complaint, of course, is that the practice discriminates against the poor.

One thing the CBS report makes clear is how big a win it is for the merchants. Even the merchants who have voluntarily returned to taking cash emphasize how much cheaper, safer, and efficient it is to run a cash free business.

As I said in the previous post, it doesn’t matter much to the credit-card-using consumer. Theoretically, someone in front of you paying in cash can slow things down when you’re trying to pay but I, at least, haven’t found that to be an issue in practice. Despite the impression I apparently gave in the original post, I’m not yearning for a cashless society, I just want to be able to pay for things using my iPhone. I’m perfectly happy if others want to use cash.

Keeping cash may even be a benefit. Some of the commenters to the original post point out some of the dangers that come with a cashless society. In the long run, I expect that cash will go away but I don’t think it will happen in the near term. There are still too many problems to solve.

Commenting on my Obsolete Tech That Refuses to Die post, Johnathan Mantey remarked that a technology that is having a hard time obtaining traction is cashless transactions and he pointed me to a USA Today article on going cashless. There are two sides to the idea of going cashless. The first side is that of consumers like you and me. We can pretty much be cashless. I haven’t used actual cash in some years. My only “cash-based” transactions are the occasional checks I write to those two small business I mentioned in the Obsolete Tech post. Everything else is Apple Pay or a physical credit card.

The other side is the merchants’. Although I’ve never encountered one, some merchants are refusing to take cash. You can see why it’s an attractive option for them. Beyond the obvious benefit of speeding up checkout, it also means the establishment doesn’t have cash lying around to attract armed robbers, their employees don’t have to spend time reconciling cash balances, and no one has to carry cash to the bank for deposit.

But there is a downside. Some people—mostly poor people—don’t have bank accounts, let alone credit cards. Refusing to take cash prohibits these people from taking advantage of a merchant’s services, whatever they are. Naturally, this created an opportunity for politicians to pander that was not ignored. Rather than find creative solutions to the problem—see the solution used by Atlanta’s Mercedes Benz stadium discussed in the USA Today article—they simply passed laws outlawing the practice.

Really, they needn’t have bothered. Most merchants who tried the cashless option have decided to take cash after all. They feel it’s more equitable and many of their customers—even those who did have credit cards—objected to the cashless policy.

From the credit-card-using consumers’ point of view, it doesn’t matter. I very rarely see anyone using cash at supermarkets or other “everyday” places let alone in upscale establishments. The amount of time I’ve spent waiting in line for someone to pay in cash is negligible. The conclusion, I think, is that going cashless is mostly an advantage for merchants.

That said, there’s no reason we can’t move to a cashless society. The advantages to merchants, and ultimately consumers, are manifest. Sweden has shown that it can be done. We can do it here in the US too. We’ll achieve a cash-free society when we start finding solutions to the problems instead of pandering. So never.