The importance of keeping cash in circulation

Cash is not in decline contrary to what we are repeatedly told. Cash still continues to be used globally.

Cash is pivotal and here’s why:

Everyday transactions

Cash remains vital for everyday transactions, particularly in small businesses where it is often the preferred payment method. Digital transactions, while convenient, typically involve fees that are not sustainable for small businesses operating on small margins.

Relying solely on digital systems will also exclude individuals without access to technology or banking services. It’s essential for society to maintain a balance and not become overly dependent on digital payments, keeping cash in circulation is crucial.

Personal and family finances

Cash plays a pivotal role in managing personal finances. It offers convenience, privacy, and control over spending. It supports daily household expenses.

For families, cash is often used to give children pocket money, teach them about money management, or provide instant assistance to friends or relatives. Cash is also used for informal repayments of debts or for making discreet purchases, like surprise gifts.

Cultural and community traditions

Cash is integral to cultural and community traditions. It plays a central role in ceremonies, where giving cash symbolises blessings and goodwill. For families separated by distance, cash provides direct, reliable support, honouring the tradition of caring for loved ones. Cash also holds symbolic value, in rituals it represents prosperity and good fortune.

The informal economy

Cash is indispensable in the informal economy, offering privacy and ease in transactions, especially where financial infrastructure is lacking. Cash is critical for people who do not have access to formal banking services.

Educating the young

For many, digital payments have become the norm, with mobile transactions offering speed and convenience. However, the younger generation are missing out on lessons about the value of cash. It’s essential to educate our younger generation on money management and the advantages of cash.

For more information on the importance of keeping cash in circulation, contact a member of our team at hello@wearepivotal.io