Globally, technology is advancing at a breakneck pace. As a result, numerous innovations have been devised in the financial industry to create more efficient processes and make life better. For example, digital payment proved to be credible and reliable through the outbreak of COVID-19. It is an advancement that best fits the era and provides comfort for users, financial firms, and corporations that take precautionary measures into account.
Technology is money
Money is a continually shifting technology. It has been a critical component of our existence for countless generations, ranging from bartering, cash payments, cheques, and electronic banking. While there is a good chance that physical currency will continue to be an essential instrument, the increasing offers, real-time results, and convenience alongside more popular contactless payment options through smartphones is causing nations to reexamine the long-term significance of cash.
Experts voiced their support for cheaper transactions, while others argue that we should go so far as to declare rebellion on cash advocating for its complete banning. Online payment policies and solutions have primarily supplanted physical money in various ways to facilitate the transfer of funds between accounts. Each platform has its own set of functionalities, processes, and features to function with multiple devices. This comfort and convenience helped cashless payment cement their place in customers’ and businesses’ daily transactions.
For instance, scanning QR codes nowadays has made deals friendlier and more secure, along with API-powered platforms such as marqeta and other payment alternatives. Moreover, these streamlined payments have assisted companies in launching and managing payment card programs on their behalf, including authorization of transactions, communicating disputes and settlements, and managing card networks. These then serve as the foundation for the creation of seamless online transactions.
Increasing the uptake of emerging wireless methods.
A cashless society can potentially speed up the global transition to digitization by convincing those still hesitant to lean to a more modernized society. According to reports, as services improve their ability to measure credit risk for a broader range of debtors, the financial industry can potentially provide an extra $2.1 trillion of credit to business owners and individuals alike. Additionally, providers could see a decrease in fees by shifting from mainstream to digital accounts.
Concerns on safety
Despite the endless possibilities, worries on the case of a cashless society still loom around it, including risks to the individual, national, or public safety. For example, the loss of smartphones, debit, and credit cards can hamper one’s life as everything would depend on e-money instead of its physical counterpart. These days, if you happen to be a casualty of digital hackers, your accounts may be closed, your credit card information stolen, your personal information breached, or your transactions fraudulently charged. Without cash on hand, it would be harder to bounce back while trying to regain access to your accounts.
Cash has consistently shown its significance for everyone throughout financial and economic crises. For example, during the great recession, physical money was a suitable medium of exchange because it provided a sanctuary for most buyers. A prime example is the Australian Reserve Bank, which saw an additional $5 billion increase in money that people demanded when the economic crisis began in 2008.
However, the technological advancements we have now have evolved since and have much to offer to safeguard funds and assets. With the continuous innovation in cybersecurity, the digital payment system is more secure now than ever. These reduce criminal activity, including extortion, bribery, money laundering, and tax evasion, which are pretty standard when holding on to physical cash. Additionally, it provides a variety of services predicated on what users need, such as discounts and e-coupons, to name a few.
Moreover, you no longer have to do any additional work to view your past spending. When it comes to reviewing your recurrent expenditure details and spending history, this system shows to be much more dependable. Every mobile banking app is equipped with a framework that keeps track of your expenditures to ensure that each transaction is as efficient and straightforward as possible—helping users keep tabs of transactions, ensuring that everything is in place and is authorized.
While cash continues to dominate the global scale, there is no denying that achieving a cashless society is already far from being someone’s fantasy. We already see its progress in most developed countries and is enjoyed by many even in developing ones. Although approaches and methods may differ, the shift from physical to cashless payments will significantly impact the fundamental features of society.
Moreover, this massive shift provides governments with an opportunity to address challenges such as unemployment and poverty and opportunities for startups to build innovative, revolutionary firms.