Moving towards a Cashless Future!

Banking CIO Outlook | Monday, August 26, 2019

Soon, the world moves towards a future that is cash-less, and to shine better, the financial institutions are innovating in all the ways to digitalize payments.

FREMONT, CA: Payment landscape is continually evolving. In the digital world, carrying cash, standing in long queues for withdrawal is time-consuming. The world is driven by the millennials now, preferring everything to be seamless and fast. One such mode of payment is through chip-enabled digital cards, which are replacing cash. The use of such cards is at an all-time high mode. Financial firms are offering better offers and benefits by launching more of such cards leading to an increase in the swiping and spending. Moreover, the advancements in recent technology are driving users to a future that will be cashless.

 Physical cash can be untraceable and anonymous, allowing it to play a vital role in the crime. Cashless payments leave behind obvious records, making it more arduous to evade taxes, conceal income and hide black market transactions. With biometrics technologies being inbuilt in payment applications, transactions have the ability to become more reliable than ever before. Payments can also be protected by fraud-preventing and end-to-end encryption technology. A cashless society also offers scope for added monetary policy. With physical cash, people choose comfort over other safe assets offering tremendous yields. However, with digital payments, people are unable to withdraw money from the financial system, meaning banks and governments can leverage greater control of the economy through monetary policy. 

Another potential advantage of a cashless society is the possibility it creates for alternate currencies aiming to encourage spending in local economies. Digital money also allows the spender to add certain cautions to their purchase on how it is consumed. Digital transactions are easily recorded and tracked, raising concerns about surveillance and who has access to the data trails. With the increase in contactless payment systems, the spread of mobile technology is catalyzing faster development of digital payment infrastructure with the use of cash slowing down for better.  

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