Will paper money become obsolete?
With the rise of digital payment systems and a search for greater convenience in the retail sphere, many economists, business experts and consumers believe the United States is on its way to becoming a cashless society. Cashless businesses – those that only accept payments made by credit or debit cards or other forms of electronic transfer – have been normalized by new-economy enterprises such as Uber and Amazon that use online platforms for payment. Now, as more brick-and-mortar businesses become cashless, some politicians and advocates for the poor are raising questions about fairness. They say going cashless can discriminate against low-income individuals, the elderly and others. But some restaurants and other businesses say eliminating cash reduces the risk of robbery and provides a service many consumers want. Advocates also say going cashless would assist authorities in controlling money laundering.
Some key takeaways:
In 2017, debit cards were the most popular payment instrument used by adults in the United States, followed by cash and credit cards.
Younger Americans are more comfortable not carrying cash than older ones, while 6 in 10 overall expect the United States to become a cashless society within their lifetime.
Sweden may become the world’s first cashless country; in 2015, only 2 percent of the value of all payments there were made in cash.
Resources for Further Study
Bandelj, Nina, Frederick Wherry and Viviana Zelizer, “Money Talks: Explaining How Money Really Works,” Princeton University Press, 2017. Three economic sociologists edit a compilation of essays that explores how social relations, emotions, moral values and institutions shape an individual’s relationship with money.
Baradaran, Mehrsa, “How the Other Half Banks: Exclusion, Exploitation, and the Threat to Democracy,” Harvard University Press, 2018. An associate professor at the University of Georgia School of Law examines unequal access to banks among low-income and minority communities.
Birch, David, “Before Babylon, Beyond Bitcoin: From Money that We Understand to Money that Understands Us,” London Publishing Partnership, 2017. An international expert in digital identity and digital money explores how technology will influence the future of money.
Roberts, Jeff John, “Why a Popular Salad Chain Stopped Using Cash,” Fortune, Sept. 14, 2017, https://tinyurl.com/
Schweitzer, Ally, “How A ‘Cashless’ Future Could Leave D.C. Residents Shortchanged,” WAMU Radio, Aug. 29, 2018, https://tinyurl.com/
Reports and Studies
“Report on the Economic Well-Being of U.S. Households in 2017 – May 2018,” Board of Governors, Federal Reserve System, June 2018, https://tinyurl.com/
“UFA2020 Overview: Universal Financial Access by 2020,” World Bank, April 2017, https://tinyurl.com/
Greene, Claire, and Joanna Stavins, “The 2016 and 2017 Surveys of Consumer Payment Choice: Summary Results,” Federal Reserve Bank of Boston and the Federal Reserve Bank of Atlanta, May 2018, https://tinyurl.com/
Swift, Art, and Steve Ander, “Most Americans Foresee Death of Cash in Their Lifetime,” Gallup, July 2016, https://tinyurl.com/
The Next Step
Albrecht, Chris, “Report: Being Cashless Backfires When Payment System Crashes,” The Spoon, Oct. 19, 2018, https://tinyurl.com/
Kauffman, Jonathan, “Bay Area restaurants go cashless, but what about the consequences?” San Francisco Chronicle, Aug. 16, 2018, https://tinyurl.com/
Nirappil, Fenit, “As restaurants go cashless, a backlash is building. Will D.C. intervene?” The Washington Post, July 9, 2018, https://tinyurl.com/
“Sweden leads the world in cashless payments,” The Local Sweden, Oct. 16, 2018, https://tinyurl.com/
Meyer, David, “Sweden Is Going Cashless So Quickly That Its Central Bank Is Speeding Up Plans for a National Digital Currency,” Fortune, Oct. 26, 2018, https://tinyurl.com/
Savage, Maddy, “The Swedes rebelling against a cashless society,” BBC, April 6, 2018, https://tinyurl.com/
Council Member David Grosso
1350 Pennsylvania Ave., N.W., Suite 402, Washington, DC 20004
At-large District of Columbia council member who introduced the Cashless Retailers Prohibition Act of 2018 to require food establishments in D.C. to accept cash.
20th Street and Constitution Avenue, N.W., Washington, DC 20551
Central bank of the United States, created by Congress in 1913 to provide the nation with a stable monetary and financial system.
Identity Theft Resource Center
3625 Ruffin Road, #204, San Diego, CA 92123
Nonprofit created in 1999 to support victims of identity theft and to provide educational resources in cybersecurity, fraud and scams.
National Community Reinvestment Coalition
740 15th St., N.W., Suite 400, Washington, DC 20005
Membership organization that promotes community reinvestment in traditionally underserved communities.
1455 Market St., Suite 600, San Francisco, CA 94103
Mobile-payment company that allows individuals and merchants to accept card payments via a smartphone or tablet.
Strategy and International Business Group
2.228, Scarman Road Building Warwick Business School, University of Warwick, Coventry, CV4 7AL United Kingdom
Business school group that conducts research in strategy and international business.
8840 Washington Blvd., Culver City, CA 90232
Fast casual restaurant chain serving salad that became a cashless business at nearly all of its branches in 2017.