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Education

StreetSmarts SM

United States ambling

toward cashless society

By Dee and Emily Karawadra Disadvantages
Impact PaySystem Potential disadvantages to a cashless society include the
following:
en year ago the notion of having a cashless soci-
ety seemed like an idea from a science fiction • Exposing of personal information to a possible data
movie. Today, we are well on our way there. breach
T With contactless payments and the spread of • Technology problems limiting access to money
mobile technology to payment facilitators, we can see
the progression toward a cashless POS, as new products • Difficulties receiving funds and paying for goods
continue to hit the market and compete with established and services among the unbanked population
solutions like Apple Pay and PayPal. • The cost of noncash payment methods imposed on
businesses and consumers
It seems there are several influencers moving us toward
a cash-free society. From government agencies and large Other nations moving ahead
corporations to financial institutions, enterprises are fa- Several nations have already begun to eliminate cash. In
voring doing away with cash. There are advantages and Sweden it is common to see signs at merchant locations
disadvantages to making this shift. that say, "No cash accepted." Sweden is leading the way
Advantages in the shift away from cash and toward digital payments.
Research shows that 85 percent of transactions in Sweden
• Advantages of going cash free include the follow- are done by card, online or a payment app. Cash use has
ing: been falling so fast that the Deputy Governor of the Cen-
tral Bank of Sweden predicted the country will become
• Lower crime because there's no tangible money to cashless within the next five years.
steal
• Less money laundering because there's always a The United States has historically been late to adopt new
paper trail payment trends and technology. For example, EMV was
• Less time and cost associated with handling paper up and running in Europe years before the U.S. payments
community began EMV implementation.
money, as well as storing and depositing it
• Easier currency exchange while traveling interna- It is evident from various studies that younger genera-
tionally tions are more inclined to adopt new means of payments
other than cash. So as new generations come and older
generations go, the share of cash in the payments mix will
decline.

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