Cashless societies - the next step for Humanity?

The fast-growing technologies of the twentieth-first century enable us to pay without money or more specifically – without cash. How did we get so far? Is cash more and more old-fashioned?

No more cash for Norway by 2030

Norway made a step forward in 2016. As a matter of fact, the Norwegian bank DNB and the government want to take away cash from the society. With online banks and the creation of apps for smartphone, only 6% of DNB’s customers are still using cash. So most of the transactions are made by card, cellphone or just through internet. That is why the Director of Finans Norge, Idar Kreutzer has said Norway could be the first cashless society in the world. Even the actual government, which was against this idea at first, is now ready to talk about it and see how to take away cash. The First Minister Erna Solberg set up two goals – the first one is to remove the law which says that banks have to accept cash, this will be ready by 2020. And then they hope to have a cashless society by 2030.

What are the reasons which made the government change their mind? There is about 50 billion Norwegian crowns (1 dollar is about 8,2 crowns) in circulation but the banks can only account for 40% of this total. That means 60% is out of control and we don’t know where they actually come from. Consequently the banks take that for their most relevant argument – without cash money laundering and the black economy will be weakened. But that isn’t the only reason. In fact, Norway spends 3,5 billion krona each year to distribute and to print banknotes and that is money which could be spend in other sectors. For the moment, the notion of Norway becoming a cashless society by 2030 will be closely looked at for the years to come.

Is the USA on the same wavelength as Norway?

The USA is far away from Norway or other Scandinavian countries. Indeed, the USA may not be ready to remove cash yet. Cash is still the most common way to pay in the USA, so it is not like in Norway where only 6% are using cash. However, Visa and Mastercard both want to take away cash because it is seen to be their main competitor. In 2016 4,300 billion dollars had been paid through Visa and Mastercard, it is twice as much as the years before. But in the meantime, the amount of cash used has also been doubled. Therefor it is still really difficult to see an American cashless society emerge and the two companies can always try to promote credit cards although it will still not be enough. 

Issues linked to a cashless society

Paying online, or with the card will always leave a track of our purchases. It can be seen as a reduction of our freedom as it is like being under control and all of our purchases can be tracked down. Do we really want that? “Ja til kontanter” is a Norwegian organization against the removal of cash, and they want to keep freedom in Norway. A cashless society is seen as a reduction of freedom because of the entire traceability of your purchases online or by credit card.

Another real issue is possible cyberattacks. It is true that without cash burglaries will be considerably reduced but the number of cyberattacks is likely to increase. In general people don’t feel safe when talking about cyberattacks because it is difficult to avoid them.

And what will be done for elderly people? In Norway they are the ones still using cash and removing it will be a huge change for them. For now, no real solutions have been found but the Norwegian banks are still working on it and don’t really think it is a big issue

How will the future be ?

A cashless society comes with a lot of questions. Is it safer that way? Easier? Or is it just another trend among others? The only thing we can be sure about is that this topic is becoming more and more significant. Maybe are we going to be a cashless world by 2050 – who knows? 

Lena Monfroy

Sources 

Erklærer « krig mot kontanter » Oterholm, Gard. 18/07/17 Dagens Næringsliv DN.no [online]

Fremtidsrettet om kontantfritt. Fåne, Jan Erik. 07/01/17 Finans Norge finansnorge.no [online]

Stor oppslutning om å beholde kontanter. Strand, Tor 12/08/16 ABCnyheter abcnyheter.no [online]

Ønsker seg et kontantfritt Norge i 2020. Ottersen Bærug, Sunniva. 14/07/14 NRK nrk.no [online]

DNB vil fjerne alle kontantene i Norge. Haugan, Bjørn. 20/01/16VG vg.no [online]