The death of cash and coin?

We all know disappointment of the grubby five pound note that looks like it’s on its last legs having been mauled by a pet, or the pound coin that’s got an odd dark patch. Physical money has certainly lost much of its appeal with the advent of online shopping and contactless payment methods.

The transformation into digitised economy will certainly only progress with the COVID-19 outbreak and the ensuing lock-down. Apart from my local fruit and veg shop, I can’t think of another store that does not have (and normally prefer) some form of contactless payment method.

Many people at the moment will be trying to secure that precious online delivery slot with a supermarket or, when in store, more inclined to hover their card/phone over the payment terminal, rather than risk whatever nasties cash or coin might be carrying.

And why bother with cash anyway? What pros does it afford us that credit and debit card can not? Cash is easy to lose or have stolen, it can be broken, damaged, and miscounted. Cards or contactless payments, on the other hand, are theoretically more secure, more precise, and more efficient. 

This does raise an interesting question about the inherent value of money. The concept of trade originates from people bartering with mutually beneficial goods; a farmer might trade bags of produce for a new wooden cart made by the town’s carpenter to transport his goods more easily. This meant that the farmer got a new cart, and the carpenter got food with which to feed his family for another week. 

Fast forward several thousand years and we now trade using intangible numbers. Gone are the days of trade being based on goods and favours, we now rely on the fact that my electronic numbers are certified by a large bank so that you can trust them to be dependable and useable as well. 

In some ways, the system is arbitrary. But, in most ways, it isn’t. Just because we can’t touch or see money, it doesn’t stop it from being the lifeblood of the world. Coins that are literally worth (in currency) their weight in gold are no less arbitrary than digital numbers on a screen that are worth their size in pound notes of the same currency. 

For those businesses that need support with their own digitisation strategy, Polestar specialises in the Software & Technology  and would be delighted to introduce you to firms we know well.

This could be digital payments, e-commerce security to reduce online fraud along with many other areas. If you would like to discuss this more, please get in touch.

76% of people asked in the survey said they expected to use cash less and move instead to other forms of payment, or online shopping more in the next six months.

By Anusheh Khan on 29/04/2020