While there are many countries who are in favour

While there
are many countries who are in favour of the move to this cashless trend as
every day we inch closer, there are still some who are sceptical of the
benefits and feel that there are compelling negatives which outweigh the
positives. Many sectors and firms are still highly dependent on cash even
though as other transition away which will be problematic, as cash could still
have a long life ahead. For many, cash holds a sentimental value as it embodies
solidarity, security and reassurance. Some in society still stash large cash
quantities, in anticipation of that ‘rainy day’. Going towards a cashless
society can be misused, creating suspicion and undesirable consequences.
Technological changes that revolutionize the status quo is something that will constantly
be encountered with resistance and beliefs that more harm than benefits arise
from it.

The push
towards a cashless society is fuelled by its efficiency and convenience. Money
has become conceptual opposed to physical and firms are reliant on consumers’
mindless attitude to spending, society is lulled thinking their money isn’t
going to be relinquished. With the simplicity and effortlessness of taping your
card against a reader or remembering your pin number combined with websites
increasingly accepting low value purchases on bank cards and subscription based
firms adopting a ‘laissez-faire’ method with financial management. Going
cashless encourages frivolous spending habits as card or mobile transactions
could expose an unsuspecting and unwary population to a spending trap. Using
cashless payments for transactions poses as a natural bulwark for consumers who
cannot discipline their spending behaviour which could be a reason for the
temptations to overspend with money they don’t have, landing them into
financial difficulties and throwing their finances into disarray. A high
penetration of the digital payment system is contingent on that the same cash quantities
does not come back into circulation. If it does, people are more likely to
switch back to the former ease of using cash as it is a habit that they may
find difficult to break.

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In addition,
from the practical barriers of going cashless, the biggest block is the
psychological shift. Looking from a consumers’ standpoint, we are advancing
three generations through a digital medium. There’s challenges for financial
institutions, banks and technology innovators to find a communal finance
ecosystem to prevent dividing society and keep us all interconnected. The
digital medium may exclude the older generation as challenges may be presented
to tech-unfriendly people who may need more time to familiarise and adapt to
the evolution in financial payments and transactions. There has been a small
resistance in society which has impeded the expansion of debit cards and could
further decelerate the progression in digital and electronic payments. Many
consumers have a partial problem with the name ‘debit cards’ and to combat this,
cards are now often stated as cash cards. Another consumer issue is that there
isn’t a net advantage to using card payments as carrying a cash or cheque books
have elements of convenience. The greatest flaw in a cashless economy is that
it could create a new socioeconomic class, as location could play a key role if
we were to go cashless. Many economists fear a two-tier society with those on
the lower end of the income spectrum becoming disconnected in a cashless
society due their reliance on conventional physical currency. Cash should be
simple between everyone in society and if society is pressured with
cashlessness it increases the requirements to be tied to financial systems as
the poor are most likely to be on the peripherals. Conventional financial
systems in developing countries struggle leaving many people on financial
fringes as 2.5 billion do not have access to banking services. (Lin 2017)

Privacy and
security are pressing issues if society were to go cashless as using Fintech
and digital payments as both consumers and producers are vulnerable to
cyber-crimes such as fraud and identity loss through cyber-attacks launched by
hackers and criminals. Society is a risk of our financial information being
exploited as in 2017, Forever 21 confirmed that a breach left customer payment
card information exposed to hackers. Hackers collected credit card numbers,
expiration dates, verification codes and cardholder names. (Hardekopf 2018).
Consumer and cynics believe that the government could use the financial data
for their own political agendas as governments or banks are common custodians
of cash where it has the potential to be misused. The fear of being tracked
isn’t groundless as there aren’t any technological restrictions to the issuer
encoding data on the buyer and tracking the use of the card, money and
financial asset can be withheld and frozen from people if they become an ‘enemy
of the state’. Also with card payment and fintech firms providing services
where banks can analyse their customers expenditure patterns then they can
target sales and promote products towards specific customers, thus can lead to
exploitation of vulnerable consumers.