The cashless society is meeting opposition again – this time from banks

We’ve discussed the so-called “cashless society” in these pages on prior occasions.  I’m fundamentally opposed to it for several reasons, not least of which is the added control it provides to Big Brother to monitor and control our every financial transaction.  However, its practical disadvantages now appear to be taking center stage with central and commercial banks.

“The digitalized system, it is easy for someone in Russia, China, whatever to just shut it off,” Björn Eriksson, the head of a pro-cash lobby group Cash Uprising and former head of crime-fighting agency Interpol. “[Cash] you can hide in your car, or your stove, or whatever.”

He added: “I can see a growing concern in my country about what is going to happen when someone decides to switch them off. What are the activities you can do to keep society moving?”

Central bankers are watching — and getting anxious.

“Increasingly, central banks insist that cash will also play a role. We do not foresee a totally cashless society,” said Ewald Nowotny, governor of the Austrian National Bank, at a recent conference in Brussels. “If there is for instance an energy blackout, cash is the only surviving way of payment.”

A senior official at the Dutch central bank echoed the sentiment.

“We’re under attack every day. If you don’t have your shields up, you notice activity straight away,” said Petra Hielkema, director of payments at the Dutch Central Bank, who watches over cybersecurity policy.

. . .

An outage of Visa services in June— caused by a system failure — gave a small taste of the risk, said Kevin Curran, a professor of cybersecurity at Ulster University in Londonderry, Northern Ireland. Customers across the EU were left unable to pay for goods and services, and the situation revealed “there really is no backup,” Curran said.

“When the trolley came around on the train and the card payment wasn’t working, the only people who could eat were those with cash,” he said.

The move away from cash is driven partly by commercial interests, as businesses go card-only for efficiency and in response to consumer demands. Commercial banks are also shutting down branches in favor of digital services.

Some governments encourage a shift toward digital services because they see it as a way to address money-laundering and tax evasion, and also to boost competition in financial services.  Others argue that digital payments protect consumers from being robbed or losing money, as well as sparing them the hassle of constantly carrying a wallet.

There’s more at the link.

Credit and debit cards, payment apps on a smartphone, and other electronic payment systems are dominant in many countries – and not just in the First World.  Africa has seen an explosion of smartphone payment and money transfer systems, because the banking infrastructure in many countries on that continent is still sparse and inefficient.

Nevertheless, the problems described above remain.  We’ve seen them here in the USA on several occasions.  It’s one reason why keeping one to two months’ worth of cash in reserve – enough to pay all your routine bills and expenditures – is a very good idea;  and not in a bank, either, but in cash, in a safe place (not necessarily at home, but somewhere thieves are unlikely to suspect it might be stashed).  If a technological or criminal crunch comes, and banks and other payment systems are no longer available for some time, it might be a life-saver – literally.



  1. I have been robbed, but not since I moved out of NYC. My guess is the main reason I have not been robbed since is my staying out of places where it is more likely.

    Redundancy is a wonderful thing. While I mostly pay with a credit card, I carry enough cash in my wallet to pay for the day's expenses and get me home. I agree with having a month or two worth of cash on hand, but keep it in multiple places. I have credit cards on multiple systems (VISA, MC, Amex) so one outage does not take everything down. I have accounts with both a local credit union and with a big national bank.

    The saying "one is none, and two is one" applies to means to make payments just like it applies to everything else in life. Have more than one way to do anything important to you.

  2. It's not just the outside attack that one has to fear over digital currency. It is the holding companies themselves, when they go on the attack, that are even more scary. Ask anyone in the civilian firearms industry about it. The very companies that have pushed everyone to go 'cash-less' are now using their immense power to regulate and control the very companies that rely upon them.

    Physical cash is less subject to the political whims of private corporations, who are the true 'evil empires' of this modern age.

  3. Some banks are tightening their requirements on take cash In the us. All sorts of reporting requirements if you deposit more than $10k a day. And the bank has some responsibility to make sure they know the cash is clean. And if you do a series of deposits just below the $10k, your committing a felony called structuring. One bank I spoke with was even considering if they would continue to take cash deposits.

    And if the bank messes up, their license can be taken away.

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