25M Brits would struggle in a cashless society
which.co.uk
which.co.uk
There is a need for a small grey area in any system to stay sane, where people can workaround the limitations of said system.
Yes, it will be abused, and also used for nefarious purposes. But it's better than the alternative.
You need people to sometimes be able to do things the state doesn't approve. You need children to be able to mess around without parent knowing. You need to be able to go to a gay bar without living a trace. You need to be able to give cash to a homeless without him being part of the system.
Also if you make it very hard to try new things that are illegal or immoral now, your society will get stuck and lose a lot of opportunities to evolve.
Yes, it would be better to change the system to make it better first. But it's a slow and unreliable process, especially if you can't prove that your way is ok. So having little pocket of experimentation is important, and cash allows that.
There is a similar analogy to what is happening in the computing world, and I've heard it called "the insecurity that gives us freedom." I agree.
"How could people have decided that marijuana should be legal, if nobody had ever used it? How could states decide that same sex marriage should be permitted, if nobody had ever seen or participated in a same sex relationship?"
https://moxie.org/blog/we-should-all-have-something-to-hide/
I fear that trying to keep a cash infrastructure in place will turn out to be a futile effort because it is so expensive. Long before cash is completely gone I bet that almost everyone who needs it will be priced out of actually using it. Also, cash has the downside of not being usable online.
The problem is that I know of no government wise enough to legislate/regulate in order to keep all the very important things you mention. Right now these possibilities exist only because they are side-effects of the physical properties of cash.
I suspect that once we really do lose cash, some sort of grass roots replacement will emerge (cryptocurrencies?). The danger is that it will be something that lends itself to money laundering and tax evasion on a grand scale. That would make it far too high risk for the purposes you're talking about.
The best solution I can think of is a constitutional right to make and receive smallish payments anonymously and a constitutional obligation for all vendors to accept one such form of payment that is available to everyone.
That would make cash one option without equating the struggle for a right to anonymous small scale payments with a specific solution that is easy to reject because it is so expensive.
It would just be a trojan horse for total control.
In fact, it would allow big actors to pretend giving freedom while in fact having perfect discreet local control when they want.
At least with cash, it's clear when you face a hostile system.
Unfortunately the longer term likelihood of retaining a cash infrastructure is equally small, at least as a realistic, effective and affordable option to pay for what people actually want to pay for.
Isn't it pretty bad that you can't use cash to buy online? Cash is becoming far less useful than it once used to be because more and more things can only be bought online or cost a lot more if you don't.
"We have to assume that if a system is perfect, then it’s static. And part of what makes us who we are, and part of what makes us alive, is that we’re dynamic and we’re surprised. One of the challenges that we’ll have to think about is, where and when is it appropriate for us to have things work exactly the way they’re supposed to, without surprises?"
If none of the banks will give you a bank account, and there's no such thing as cash... then you're just not allowed to have money. That shouldn't be a position that it is possible to get into.
In the UK, the nine largest banks are legally required to offer basic bank accounts specifically to cater to people who cannot otherwise get a bank account.
https://www.ukcisa.org.uk/blog/6538/Student-banking-Do-you-r... gives a decent overview of the process. It also mentions the unofficial national ID of the UK, household utility bills.
The punchline is whether a printout of a PDF of something that never had a print original counts as an "original" for ID purposes in a completely adhoc adversarial system. https://assets.publishing.service.gov.uk/government/uploads/...
Sidenote: I was in on bitcoin back when you could generate blocks with a CPU... and came to the conclusion that privacy of transaction was too fundamental to a good coin and abandoned bitcoin. Given central banks ability to invent money at scale, I also always thought the 50% attack was something they would work towards... and so that's the story of how I almost became a millionaire.
https://www.treasury.gov/ofac/downloads
[1] or someone with the same name and similar residential history
Check out creditboards.com for lots of ways to get those companies to straighten up.
Those stories tell you a lot about the person in question. How it didn't work out and how they cope with that "loss".
Yours is the first where someone coped out because not being satisfied with the kind of privacy Bitcoin provides.
A coin that uses all that compute to work on protein folding or other big problems that also has privacy would be something I would really like to see.
It seems like helping people get bank accounts would be what you’d want, though the IT issues arround outages and lack of network services in area is a hard one.
I've personally seen friends struggle with all of the above, but the reloadable AMEX cards at Walmart seem to be doing well to fill in the gaps (except for not being able to direct deposit into them)
Additionally, I know many employers in Indiana offered prepaid cards to their employees that did not have bank accounts. It has been 5 or 6 years since I lived there, mind you. These had fees involved as well, but it was better than nothing.
It really gets my goat that some banks even charge monthly fees. Having a checking and savings account should be free. Withdrawing from and depositing to the account should be free. Writing checks and using a debit card should be free.
I am not a fan of overdraft fees, but I can see that they're at least justifiable.
Please don't patronize banks that have these fees.
I would surely love 2% on my checking though! I thought 2% was on cash back, I will need to search for 2% checking with no restrictions somewhere
My credit union will give you 2% in checking if you meet all of these:
10 debit or credit card purchases per month
enroll in and maintain eStatements, eNotices, eTax & eCoupons for your accounts and loans
$300 minimum monthly ACH credit transaction or $5000 in deposit or loan balances
Previously, they required 10 debit card transactions per month, and I'm not sure I've made that many in my life. I'm going to check a bit closer on this, thanks. Credit union is StarOne.
You can be banned from getting credit pretty easily too; if you've failed to pay council fines (parking, tax, etc.), or missed a repayment on a loan, a judge can give you a ban. It can be a real problem for people who get into a bad financial position and want/need a new bank account later on.
I live in an essentially cashless country, but even countries where cash is still used would be very hard to live in without a bank account, so that legislation is important.
https://monzo.com/blog/2018/05/29/getting-bank-account-immig...
But to take an extreme case, there's nothing preventing you from getting yourself into trouble due to a lack of valid payment methods. For example, Americans have visa-free access to the EU, so nobody will check their finances, and an American could theoretically land somewhere in the EU without a payment card and only carrying US dollars, which aren't legal tender.
I thought part of the job of immigration officers is to screen travelers for ability to sustain their trip? Visa waiver does not mean you are entitled to enter.
When I (an American) visited the UK and EU on a backpacking trips, the immigration official asked me how I'd cover my expenses, and specifically queried about backup plans if my card wasn't accepted. (This was back before chip and sig rolled out)
Though they did just take me at my word I had enough US dollars that I could convert them to pounds and get a room if needed...
Correct, but in practice the level of scrutiny depends on where you're from, and which country you're entering. From what I've heard, people from rich Western countries, like the US or Canada, are generally allowed in with only perfunctory questioning, especially in countries where the immigration officers are known to be more relaxed. So an unprepared American is still likely to get into the EU, but a Colombian would probably be questioned more, despite being in the same legal category as a US citizen.
When that happens you don't have a home country that you have a meaningful connection to, and you certainly don't have a bank account there.
For some it happens due to predictable visa expiry and rules ordinary people can comprehend. But for others it is impossible to know in advance (I have some experience with lawyers who are unable to figure out how the law applies in practice in some cases - few can afford a proper judicial review to find out). There are numerous articles in the press in recent years about people who were resident in the UK for a long time, have long since settled with families, then suddenly found they lost basic rights.
The ones which shocked me most where people who were branded "persona non grata" as if terrorists, because they filed minor corrections to their tax returns - the problem with that is not only do the then immediately lose UK rights, they also get a stamp that excludes them from most other countries of the world. That's a harsh price for doing the right thing. That sounds implausible, until you know that the UK Home Office has exclusion targets, and will use any random tick-box to exclude people no matter if it's not justified and would lose on appeal in front of a judge. (Most appeals against Home Office decisions about residence overturn the decision, which shows how dodgy the decisions are, but the right to appeal has now been removed in many cases.)
Right now, there are a large number of people in the UK who do not know with certainty whether they will be allowed to maintain legal residence in the next few years or not. So far, non-UK EU citizens do not need visas or similar documentation while being resident in the UK, even for their whole lives. This means they don't tend to keep a strong paper trail. But that is probably about to change, and for many of them this already creates uncertainty about their future rights, because the UK has a harsh reputation for refusing long-term residence for bogus reasons, such as a gap in perfect record of household bills going back a few years, or failing to purchase some obscure kind of private health insurance a few years ago which nobody knew was needed but is now cited.
The situation to come is worse for, for example, non-EU spouses of UK citizens, who obtained the right to bring their spouse into the UK via EU law (the human right to a family life). Surprisingly, a UK citizen does not have an automatic right to have their spouse live with them in the UK - there is a substantial earnings threshold. This may force spouses who thought they were settled here to have to leave the UK and their families, over the next few years.
When any of these events happens, you are denied the ability to rent privately (even in cash), to have a bank account, or to use health services.
Very few of these people have a bank account in their home country. Why would they? They've been living and settled in the UK for years. Working, married, with families, all legally, until the day they find out they aren't.
This is little comfort if you're not a legal EU resident, or if they believe you're laundering money or financing terror groups (whether you actually are or not).
As long as there are any caveats to "cannot refuse bank accounts to all people" then switching to a cashless society would create an underclass of people who are just not allowed to have money.
Governments are quite imperfect, and humans are a varied bunch. There are exceptions to everything , and exceptions to that. The Windrush generation is just a recent example that comes to mind: luckily, they were numerous enough to get their story heard. But people fall through such cracks every single day. Sometimes an imperfection in the law, sometimes an “overzealous” public servant.
Do they have to prove this, or is their belief enough? And are we okay with the punishment for money laundering being death by starvation and homelessness?
For another, banks don't have to show anything. It's risk management, they can close your account if they believe you're high risk, partly because if they didn't they'd get fined by the USA for money laundering. See: HSBC, whose fines were largely due to not closing accounts aggressively enough.
...BUT, for privacy and the unbanked, I suspect this necessarily needs to go along with credit-card-compatible "cash cards" that would have to be:
1) Anonymous (e.g. buy a card for $1 from any drugstore, swap them with friends, buy in bulk and give away, whatever -- don't need to show an ID)
2) Secure and robust (value stored on-card without the ability for the government to deactivate etc., or for transactions to be cancelled after-the-fact)
3) All ATM's and banks required by law to support transferring any reasonable value (e.g. <$10K) from one card to another anonymously (so if I need to pay you, the two of us can walk into any bank). Ideally be able to do this at any convenience store, etc.
For whatever reason, I rarely see the idea of anonymous cash cards discussed in these types of conversations.
Because it's really really hard to prevent forgery. Maybe impossible.
The right people in law enforcement could probably make a few calls and shut down an arbitrary prepaid card (or group of them). There's also a strong paper trail that can be used for that-- they could reasonably say "any card that was used at this suspicious merchant should be shut down".
They can't demonetize a few random $100 notes with anywhere near the same degree of ease or specificity. Nor does the logging infrastructure exist to find every note which touched a suspicious individual.
> value stored on-card
These two things don't go together.
Plus, since we're talking about a government-issued currency, a lot of the drawbacks of a typical cryptocurrency wouldn't apply (the government can be considered the central source of trust, so no need for a proof of work system or anything).
Once you are in the domain of "Anonymous $1 cards which people swap with each other", you no longer have this option. The obvious thing is to have corresponding entry in online database, but then anyone who wants to verify the card value will have to access this database -- so your privacy disappears.
I am not saying that it's impossible -- people are smart, something can likely be figured out -- but it is not obvious to me those cards can be made harder to forge than cash.
As in, if people decide to simply exchange the physical cards instead of charging/discharging them, the cards effectively become a plain old traditional currency.
And they all relied on cash donations. I wonder what will happen to these people as society becomes more and more cashless? What effect will it have on crime?
[0] https://www.standard.co.uk/news/uk/homeless-people-wearing-b...
[1] https://www.bbc.co.uk/news/uk-england-london-46372244 and https://www.taplondon.org
The consensus view among charities who work with the homeless is that a) most beggars aren't rough sleepers, b) most rough sleepers don't beg and c) begging primarily serves to fund drug addictions. Though by no means universal, many people in the sector are of the opinion that giving to beggars has a net negative effect by helping to perpetuate addiction. Begging certainly isn't a sustainable solution to the factors that cause homelessness - mental illness, addiction, economic insecurity and a lack of social housing. It is entirely plausible that the diminution of begging by a move to cashlessness could see an increase in acquisitive crime.
I can't imagine that this move would be particularly helpful for people with addiction either. Their addiction won't go away, but they'd probably find other ways to fund it, which might involve entering into really unfortunate power dynamics.
> SituationSthlm is a Swedish magazine similar to the UK’s Big Issue, sold by homeless people in Stockholm. But the sellers couldn’t sell magazines to people who didn’t carry cash. The solution? A badge for sellers with a QR payment code. Buyers scan it with their phone, make a digital payment using the mobile payment system Swish, and then the seller collects their cash from the SituationStklm offices soon after.
> “This solution originated to help sell magazines, but soon showed other benefits. It helped homeless people carry less cash – which reduced their vulnerability to theft, and also gave them a way to budget by leaving their money at the office until they needed it,” said the report.
> The researchers also found that Sweden had benefited from lower crime and higher tax revenues as cash usage had fallen, but it added: “We must not demonise those who operate in cash, when many have no choice.”
[1] https://www.fbi.gov/file-repository/bank-crime-statistics-20...
There are other crime-reducing forces as well -- smart car keys which are harder to steal, activation lock on the phones which prevent reselling, and so on.
I do wonder how crime would adopt to future cashless society. I think most of the mugging and pickpocketing will go away. Will this mean increase of burglary? Or will the criminals start doing something else?
A friend a decade older than me said it was the usual effect of Conservative government policy, but I was too young to have noticed the previous implementation. I was 11 when the Conservatives lost power in 1997, and they only fully regained it in 2015.
Businesses would love to be able to exclude people too poor to use their services from society- It's a real ugly situation. Like a decentralized apartheid based on financial status.
Without the government stepping in and trying to prevent this discrimination, there is no one to stand up for these human being's lives
I'm pretty sure there are large swaths of society that would really hurt even though some would exclude folks. Everything from fast food to grocery stores to cheap clothing outlets.
Are you thinking about credit checks to stop poor people getting phone contracts? Because that already happens and cash existing hasn't stopped it.
How would that work, and what's the incentive for it?
People who can't afford a business' service are already excluded from it by definition, regardless of payment method. For those who can afford it, what's the incentive for the business to turn them away and not profit off them?
The real reason they are pushing for "cashless society" is so they can impose negative interest rates. Since you won't have the option to withdraw your funds into cashier, you bank balance will be debited monthly as a privilege for giving the bank money.
Its their next hairbrained scheme to try and shore up their ponzi-scheme economy.
And even then, you would still be able to buy stocks, expensive jewelry, gold, houses and so on.
You say this as if tax fraud is a consequence free activity.
>And even then, you would still be able to buy stocks, expensive jewelry, gold, houses and so on
Sure, but everyone will do that, so those asset prices will surge making it a poor investment
Yes, that's the idea! The point of negative interest rates is to force people to buy things, thus jacking economic growth like caffeine to a coffee addict. So this is hardly any solution.
London has a ton of places that don't accept cash already.
Go to smaller towns in the North and you'll hit minimum charges to use a card or broken machines.
Even in small supermarkets you'll have to queue for a smaller number of automated checkouts that can do cash, rather than the big row of card-only checkouts.
Ironically, in 'the South' I believe a lot of card machines in cabs have a habit of being broken unless you're adamant that you don't have cash on you?
https://www.raspberrypi.org/raspberry-pi-store/
(Digressing, but I was also saddened that their tills are tablet EPOS systems and not home-brew with a Pi at their heart)
Post Zelle? I dunno. The last time I just wrote a check.
A direct transfer from online banking might take overnight or over the weekend, but there is an app that lets folks pay each other that is low-cost and speedy (or pay for a soda from a machine).
We have a joint credit card but I don't see why we'd ever need a joint bank account.
We have separate bank accounts and credit cards and we split the bills most things, like groceries. But we don't look into what personal purchases we make, for example me buying Lego.
It's pretty easy to decide if we should pay together or not. At least for us.
That way, you never have to deal with splitting shared expenses, there's no worrying about who's earning more, and financial decisions are by default made together, but you can still buy your LEGO with your own money.
It's fine to have a joint account that you pool part of your income into. But there is no reason not to have a private account as well. And trusting someone doesn't mean having to completely expose everything to them. Just because I trust someone, I won't let them snoop through my phone, hand out all my passwords, or give them 100% access to my bank account.
Trust also means to trust someone enough to let them do their own thing.
After all, if you are married you are jointly and separately liable for all assets and debts so why doesn't your banking arrangements reflect that fact?
In countries with matrimonial property regimes, that isn't necessarily the case.
This is a problem in cases where (typically) a husband is abusing his wife, by withholding her access to the funds unless she does what he wants.
The solution which is finally being looked at is to revert to paying each person their benefit entitlement separately.
That's not even something the abused spouse can choose for themselves because they "don't trust". It requires the state to recognise it is important to treat each spouse separately, automatically for all of them, to limit the possibility of abuse via joint accounts.
Just as importantly, I can't imagine that I would have zero chilling effect on my spouse either. So even if they preferred a joint account, I'd insist _they_ have a private account that I couldn't see as well, and that it had some liquidity in it.
It is important to me that my spouse feels as free as possible, and that they have some personal life which is just for themselves, outside of my view.
Everyday spending is on the debit cards, and immediately visible in our online banking apps.
Birthday presents and things we want some privacy about go on our individual credit cards, with just the total monthly repayment visible in the joint account.
"Lord Adair Turner, formerly the UK's chief financial regulator, said "Banks do not, as too many textbooks still suggest, take deposits of existing money from savers and lend it out to borrowers: they create credit and money ex nihilo* – extending a loan to the borrower and simultaneously crediting the borrower’s money account"." [0]
* hilarious use of Latin to make 'out of nothing' sound authoritative
[0] https://en.wikipedia.org/wiki/Fractional-reserve_banking
These types of articles are only useful if your looking for a starting point to get a conversation going on a topic. They are not good for supporting your conclusion one way or the other once you have analyzed the topic.
>Projects with the goal of digital inclusion are making a big assumption. They are assuming that participating in a digital society is good, but that's not necessarily true. Being in a digital society can be good or bad, depending on whether that digital society is just or unjust. There are many ways in which our freedom is being attacked by digital technology. Digital technology can make things worse, and it will, unless we fight to prevent it.
>Therefore, if we have an unjust digital society, we should cancel these projects for digital inclusion and launch projects for digital extraction. We have to extract people from digital society if it doesn't respect their freedom, or we have to make it respect their freedom.