Why we shouldn't stop using cash
A book shop in my neighborhood has a sign on its door: “PIN only”. It's definitely a trend. More and more stores accept debit cards only. Why? Well, in an attempt to fight crime. And I think they have a fair point. A store further down the road has been robbed twice in a short amount of time. They installed several cameras and have every inch covered now.
In The Netherlands the euro is a valid payment method. However, the law doesn’t specify everybody needs to accept it. Stores are allowed to reject cash as long as they indicate it clearly via stickers or signs. (Jurofoon, https://www.jurofoon.nl/blog/blogpost/mag-contant-geld-geweigerd-worden)
In May ‘16 ten public transport organizations created a plan to ban cash payments in 2018. Travelers should use the ‘OV-chipcard’ instead. Motive for accepting electronic payments only is that there have been a few robberies on busses and assaults on trains. The public transport organizations had to come up with a plan to guarantee safety for their employees.
The Dutch banks want to reduce the use of hard cash. KNAB is an online bank that doesn’t allow cash deposits or withdrawals. Rob Vellekoop wrote an article about this and concludes this is a dangerous situation. A bank doesn’t need to have money in cash anymore and can transfer the money electronically. In case we don’t trust banks anymore, how are we going to get our money? A bank run like in Greece wouldn’t be possible. I’m not entitled to say whether that’s good or bad. In the end cash money is just paper that has a certain value to exchange goods. Money can lose its value whether it’s paper or digital. (Venezuela / Bitcoins)
Personally I prefer paying in cash if I have the choice. In the past I didn’t care, but learning about Big Data and what companies do with customer data has changed my perspective. Take for example ING that uses Big Data to analyze transactions to yeah, to do what exactly? It bet it's interesting to see someone’s payment history. Is he subscribed to Spotify? Is he a KPN customer? To which grocery stores does he go most? Where does he do online shopping? ING has received a lot of feedback from privacy concerned customers. And maybe they back out a little because of that. But every large company knows that Big Data offers a lot of possibilities. As both computer power and the number of tools increases, there's only a cultural barrier left. And I think customers should be at least somewhat aware of the possible consequences.
I know several people who couldn’t open a bank account right away. And no bank account means now debit card. Each bank has different conditions. Some require you to show papers that indicate a valid address and certain income, others require just an identification but don’t allow you to overdraft. Sometimes you need papers from the IND (Immigration and Naturalisation Service). And well, those guys are busy so that might take a while. The requirement one needs a debit card to pay could also be problematic for homeless people and tourists. I don’t suspect every homeless person has a debit card. Also, how is he / she going to ‘collect’ money on the streets if nobody has cash in his pockets anymore?
I think debit cards have a lot of advantages, but saying that it should be used at all times raises my eyebrows. Possible drawbacks of the debit card in my opinion are:
- Malfunctioning of electronic services
- Each time you enter the security code there is a possible risk that somebody else is watching
- Payment history is stored centrally
- Generalization of Big Data analysis
- More power to the banks
I recently heard about a German company called Barzhalen. If you order something online, you receive a barcode. You need to bring the barcode to a local retail shop and pay in cash. Then the payment is confirmed. Yes, that sounds like we’re going back in time… And maybe it is. But at least then your bank doesn’t know where you do your online shoppings. Would that be worth the trouble for you? Maybe the Germans are more privacy concerned. Or conservative even. I don’t know. I haven’t seen such an option in a Dutch webshop. But apparently there is a market for it in Germany.
> What do you think of cash? Do we still use it ten years from now? And, do you mind if your bank has a track record of your payments?