Will the 21st century see the rise of a cashless society? The introduction of credit cards, digital wallets and cryptocurrencies have led experts over the past decade to speculate on the progressive demise of physical money, with stakeholders such as banks, consumers and governments seemingly gaining from the change. If the world went cashless tomorrow, banks may rejoice at no longer handling notes and coins, which can be counterfeited or stolen. Digital payments would also give banks and payment processors greater information on their customers’ lifestyle. For central banks, digital money could mean more insight into how money flows through the economy, with early warning signs possibly helping monetary policy function more efficiently.
But what of the US$1.7b unbanked worldwide? If people rely entirely on cash, they cannot borrow to grow their businesses or improve life for their families, as cash-dependent often means credit-less. This report from EY discusses the advantages and dangers of moving towards a cash-less society.