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'The Cashless Society is a Con -- and Big Finance is Behind It' (theguardian.com)
An anonymous reader quotes this opinion piece by former derivatives broker Brett Scott:
Banks are closing ATMs and branches in an attempt to 'nudge' users towards digital services -- and it's all for their own benefit... I recently got a letter from my bank telling me that they are shutting down local branches because "customers are turning to digital", and they are thus "responding to changing customer preferences". I am one of the customers they are referring to, but I never asked them to shut down the branches... I am much more likely to "choose" a digital option if the banks deliberately make it harder for me to choose a non-digital option. In behavioural economics this is referred to as "nudging". If a powerful institution wants to make people choose a certain thing, the best strategy is to make it difficult to choose the alternative...
Digital systems may be "convenient", but they often come with central points of failure. Cash, on the other hand, does not crash. It does not rely on external data centres, and is not subject to remote control or remote monitoring. The cash system allows for an unmonitored "off the grid" space. This is also the reason why financial institutions and financial technology companies want to get rid of it. Cash transactions are outside the net that such institutions cast to harvest fees and data.
A cashless society brings dangers. People without bank accounts will find themselves further marginalised, disenfranchised from the cash infrastructure that previously supported them. There are also poorly understood psychological implications about cash encouraging self-control while paying by card or a mobile phone can encourage spending. And a cashless society has major surveillance implications.
While a cashless society might make it cheaper to run a bank, "A cashless society is not in your interest..." argues the author.
"We must recognise every cash machine that is shut down as another step in financial institutions' campaign to nudge you into their digital enclosures."
Digital systems may be "convenient", but they often come with central points of failure. Cash, on the other hand, does not crash. It does not rely on external data centres, and is not subject to remote control or remote monitoring. The cash system allows for an unmonitored "off the grid" space. This is also the reason why financial institutions and financial technology companies want to get rid of it. Cash transactions are outside the net that such institutions cast to harvest fees and data.
A cashless society brings dangers. People without bank accounts will find themselves further marginalised, disenfranchised from the cash infrastructure that previously supported them. There are also poorly understood psychological implications about cash encouraging self-control while paying by card or a mobile phone can encourage spending. And a cashless society has major surveillance implications.
While a cashless society might make it cheaper to run a bank, "A cashless society is not in your interest..." argues the author.
"We must recognise every cash machine that is shut down as another step in financial institutions' campaign to nudge you into their digital enclosures."
It's not only banks/financial institutions, but also governments that like cashless societies, because it gives them better surveillance and more control.
The good thing is: they'll likely overplay their hand and lose control: if governments get rid of cash, people will find alternative payment means completely outside the control of banks and governments. Bitcoin didn't quite get it right technically, but systems like that will catch on.
It's not because technology allows it that it must be the preferred option (electronic voting is a poster child of the idea). I don't mind if my neighbor prefers being tracked with his credit card and iPay and Air Miles, but at this point, global customer insouciance seems to pave the road to forced global surveillance in every aspect of our lives; we don't need this crap, wake up people, thank you very much.
If they're so insistent on taking cash away, take it one step further in the opposite direction and remember, in your neighborhood, you are surrounded by a ton of people with a ton of valuable skill sets. Barter where you can and cut both the bank and the government out of the equation entirely. I just traded some of my IT time and knowledge for a neighbors expertise in electrical and plumbing. We both came out ahead all the happier, with no bills, taxes, invoices etc. to tally up once the taxman arrives. Not every interaction has to revolve around money, and I managed to make a couple good friends as an added bonus.
Banks hate cash. It requires physical handling. It can be stolen. It wears out. It "isn't working for us" as it sits in a vault, an ATM, or an armored car. Electronic money can be working all the time - earning interest, being leveraged, being arbitraged, whatever. Cash is so "static" compared to electronic funds.
The Brave New World is almost here. Add an implant and the process will be complete. Can you imagine being arrested on suspicion of a serious crime because 30 minutes prior to the crime, in the "walking distance" proximity, you bought a pack of gum with your implant (or your debit card, or your smartphone)?
I'm rather old, my friends, and as you revel in your youth (assuming you are there), marvel at how anyone could be happy to be older. This world is yours. I'll be in it for a little longer, but not nearly as long as so many of you. I suppose cashless is your future - not so much mine.
I love cash, but electronic money is more convenient, more versatile and great.
Just ask a non-bancarized guy in Kenya or Tanzania using M-Pesa about it... And trust me when I tell you that Safaricom and Vodafone did not implement this from the goodness of their hears, but for pure profit, and yet, it ended up raising the living standards of the people at large, and specialy of those non-bancarized.
Sources:
The economist Sept 26-oct 2, 2009
And IEEE Spectrum here:
https://spectrum.ieee.org/stat...
Yes, if we look at electronic money and a cashless society from the optic of a westener who has enough diposable income to aford a computer and knows what this "internet" thing is, is all doom and gloom.
But once we try to get ourselves in the whorn -out shoes of less fortunate people that make less than $1 a day (and for me, being in Venezuela, this is easier, as is not a tought experiemnt, but a reality I see everyday) we see that electronic money can be beneficial for everyone, warts and all...
So, I for one, welcome our e-money overlords... Yes, I wish there would still be cash, but... whatever benefits the many is ok by me...
*** Suerte a todos y Feliz dia!
By design 'late payment' is never an issue on debit cards.
"The likes of Facebook and WhatsApp are free to those whose privacy is of zero value."
I think they (banks, Visa, etc.) Want to skim every transaction.
That is true in America, but not everywhere. In China, WeChat and AliPay have zero transaction costs for either buyer or seller. The value of the data collected is enough, and competition keeps them from charging fees.
I recently pulled up to a drive through of a nationwide bank chain to find that it had closed just a week before; I had to go into the lobby and stand in line.
While in line, a "personal banker" approached and asked if she could help me with anything. I commented about having to get out of my car and walk across the parking lot to come inside while it was raining.She explained that the bank was removing DT tellers at most locations, because so many people use digital payments.with their phones, so no one was using the DTs anymore.
I explained that I know just how secure phones are, and that I would never trust financial stuff to a device that is so easily stolen. "If they get your phone, they can get just about anything else."
She assured me that that was not true, and even if it were, I would only have to use their APP to track what was going on, and to report the bogus transactions.
"You mean the APP on my stolen phone, where your website sends the confirmation text for your two-factor authentication?"
She didn't appreciate the irony...
Banks love the "cashless society" because they get a profit from every transaction everywhere. The government loves it because it provides a trail of breadcrumbs through every place you visit, complete with time stamps. Does the government really need to know which fast food outlet you prefer or where you go to buy groceries? I don't think so, but the data is being collected nevertheless.
The bank or Government can freeze your accounts on a whim if they donâ(TM)t agree with what youâ(TM)re doing. Thus, they can control or influence what you do since you wonâ(TM)t have the option to use cash.
Porn industry and Gun Dealers whoâ(TM)s accounts were closed for no reason other than the industry they represented come to mind for this.
Going full digital will basically add a hidden tax to every purchase. A processing fee or something similar.
Think of major CC vendors transaction fees.
Full digital is also a surveillance States wet dream as every purchase can be tracked, flagged and / or categorized.
Finally, the proliferation of malware and assorted nasty stuff designed to steal digital credentials for purposes of fraud is a real turn off for going cashless.
Fix all the aforementioned problems and weâ(TM)ll talk about it. Until then I will use cash when I wish because I can.