The increasing importance of cash in an uncertain world – Ron Delnevo
There is more cash circulating in the UK in 2024 than ever before. Around £90 Billion, including almost £5 Billion of coins. This represents a 46% increase in the last 10 years and amounts to £1500 for every British adult. That figure of £1500 is also the average amount withdrawn per adult from UK ATMs in 2023.
Cash has a number of distinct attributes that make it uniquely attractive to the public and important in society.
Security
One of the basic values associated with the existence of cash is security, both for citizens and for the institutions that look after their well-being.
When there are natural catastrophes, such as hurricanes, when the electricity supply is lost, only cash guarantees the ability to buy food or drinking water. Then there are the man-made disasters which have become commonplace in our “digital society”. In July 2024, a botched software update hit Microsoft Windows operating systems around the planet. Suddenly, only cash worked, unfortunately some businesses didn’t have the option to accept it.
Inclusion
No society can be described as inclusive if there is only one way of participation. Individual citizens must have the right and the freedom to decide what is progress for them.
A small number of major multinational corporations now control mobile communication devices, payment systems and the apps through which those systems are accessed. Those multinationals engage in massive marketing of their services. This has influenced some retailers to try to impose payments solutions only available through smart phones and other smart devices. The end game of this fast-developing trend could be that owning a smart phone will be mandatory.
With millions of UK citizens still without bank accounts or smart phones, offering services purely via apps or online excludes a significant percentage of the UK adult population.
Independence
Cash provides true independence because it frees users from 100% monitoring and control. Independence from systems controlled by corporations and governments means that cash allows individual freedom of action that could be denied in a “cashless” society.
Ease
For many citizens, for the majority of exchanges of goods and services, it is easier to pay with cash than to rely on electronic solutions. Cash has the potential for universal acceptance, while technology can be a barrier in terms of knowledge, habits, health, location, or income.
Specifically, cash does not depend on access to the Internet, fast telecommunications, electric power, sophisticated personal communications devices or complex computer systems.
Sustainability
Despite its reputation for beneficial technological innovation, the deployment of massive electronic payment systems is not ecologically neutral, because their operation involves an energy consumption that is not necessary in cash exchanges. The greater the dependence on electronic payment systems, the greater the dependence on energy for its operation.
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