While a number of cashless transactions continue to increase year after year, the use of cash continues. The only countries in which cash use is in decline are those countries whose governments actively pursue policies designed to eliminate cash, such as Sweden and Denmark. In most other countries cash use has actually increased over the years. Why is that?
Easier to Use
For one thing, cash is easier to use. Everyone knows what it is, is familiar with it, and knows how to make change. For all the convenience of electronic payments, it is often dependent on the technology working right. A glitch in the software, a phone that goes buggy, or credit card systems not communicating can all lead to delays at the point of sale. Handing the clerk a $20 bill and getting your change can often be much quicker.
Cash also allows for anonymity of payments. Credit card transactions are collected by companies and sold to data mining firms for marketing and advertising purposes. That means that everything you purchase is in a database somewhere, ready to be traced or tracked by a marketing company or by the government. For online purchases, use of non-cash payment methods is just about unavoidable, and the growth of e-commerce has been a major contributor to the growth of cashless payments. But when going to the grocery store, purchasing goods at yard sales and thrift stores, or purchasing medicine you can still keep your purchases underneath anyone’s radar.
The Tangible Nature of Cash
The fact that you can hold cash in your hand is another significant factor in its continued use. It just feels like money, whereas cashless payments don’t. It also confronts you with the amount of money you’re spending in a manner that cashless payments can’t. Pull that $50 bill out of your wallet and you know you’re spending some major money and you feel the pain of the money leaving you. You can’t say the same for credit cards, which can be swiped without a second thought.
Credit cards, contactless payment, and online transactions all have their place. In many cases they make life easier, yet still cash use persists. As long as governments don’t get involved in trying to force cash out of existence, it will continue to remain an important part of the economy.