A few weeks ago, I decided to move house. My preparations included ordering cardboard boxes, ensuring electricity and gas would be available on day one, becoming panic-stricken at the amount of stuff occupying my kitchen cupboards, and selling half my furniture.
When it came to the latter, two matters quickly came to light.
Firstly, when living alone, it is unwise to sell the only furniture you can stand on, at least until you have packed all the items in the topmost corners of the house.
Secondly, cash is a novel concept to me.
Yep, it wasn’t until I had waved goodbye to my final Gumtree sale that I realised it has been quite a long time since I held a $50 note, let alone a few of them.
I’ve always been pretty bad at carrying cash. Even when I lived in America, where you’re sort of required to carry a wad of singles so you’re permanently equipped for tipping, I was notorious for being the person who had to borrow $1 so I could grab a drink. (You can pay for a drink with your card, but you usually tip with cash!)
By the time I moved back to Australia, contactless payments were all the rage, and I never looked back. Lunch? Tap it. A beer? Tap it. Six pens — in an array of rainbow colours, no less — for the guy who sits next to me at work? Yep, tap it.
It seems I’m not the only one.
The Reserve Bank of Australia issued a report in December 2016 titled “The Future of Cash,” in which it was noted Australian consumers have increasingly been using electronic payment methods in preference to cash for their transactions.
And we’ve seen the payments ecosystem bloom thanks to apps and companies such as Apple Pay, Square, and Beem It, which perhaps makes a cashless future more likely.
But is a cashless society a boon or a boondoggle?
For some businesses, going cash-free makes a lot of sense. Not only can a cash-free business be easier to run when it comes to record-keeping, it can also be safer in terms of theft. Not to mention you eliminate the time spent counting cash and taking it to the bank.
The government is into the idea also. As part of an effort to tackle tax evasion and other criminal activities, the government is thinking about introducing an economy-wide cash payment limit of $10,000 for payments made or accepted by businesses for goods and services.
The problem is not everyone has a debit card, and for those that do, it doesn’t mean they want to use it. Research conducted by the RBA in early 2017 found that older Australians and lower-income households make a substantial share of their payments in cash.
There’s also a category of people who are conscious of privacy issues. According to a study conducted by Accenture earlier this year, 33 per cent of Australians have reported a fall in trust in banks in the last year, most likely caused by the banking royal commission.
The more cash-free we become as a society, the more the banks can track our spending (and possibly other financial moves). This could be seen as helpful by some — banks such as CBA are using customer data to make recommendations (e.g. to suggest the customer saves a tax refund or advise if they may be entitled to claim a government subsidy) — but for others, it might be invasive.
Then there’s those people who just enjoy using cash as a budgeting method.
To me — and I imagine many Australians — there is something to be said about consumer choice. While I love my cash-free existence, and the many apps that help me live this life, would I love it as much if the choice wasn’t mine?
I’m curious to hear your thoughts on this.
