Cash or card?

I am not much of a joiner of single-purpose campaigns. But here’s one I’d maybe pay money to support.
And that would be appropriate, because the subject is money, and to be precise, coins and notes. Despite the offical Bank of England line that cash is here to stay, there seems to be growing drumbeat of opinion for abolishing both. The most recent Weekend FT ran a piece on the topic (here it is, paywall) pointing out that Sweden is making progress towards seeing off notes and coins altogether, and that other nations are following, albeit at a slower pace.
Admittedly the same piece concedes that the UK supply of notes and coins has gone up, and that more people are now using only cash for their finances. But there’s little doubt that the abolition of cash is gaining traction as an idea.Of course, enthusiasm varies around the world. It is hard to imagine low-street-crime, high-banknote Japan going all-electronic soon.
Why? Well, part of it is the old story of bits and atoms. The former are more movable and cheaper to process. But if you think about all the things holding back the UK economy (don’t get me started), where on the scale is the hideous cost of handling all those pound coins, fivers and the rest? Nowhere high on the list, I’ll be bound.
So what is this really about? The obvious answer is that an all-electronic economy puts everyone in a panopticon from which there is little escape. Everything costs money. The only way round it would be a false identity.
There is a slight argument here that putting us all in this prison would allow evildoers – tax evaders and criminals – to be caught. This is nonsense. It means that we regard their activities, which account for only a few per cent of the economy, as outweighing the lives of all the honest people. In any case, we know from the Paradise Papers and many other sources that crooks use banks. There’s an estimated $T of their loot running through the banking system each year.
There’s also an argument that says much of the criminal use of cash can be killed off by abolishing the highest-value note. That’s the fifty for the UK (already rumoured), the €500 in the Eurozone (none now being issued although they remain legal tender) and the C-Note in the US. This is an argument I’d buy, although the same FT piece quotes an anti-cash zealot as saying that this is merely a first step on the slippery slope to killing off the oher notes too.
Abolishing cash does of course have some other upsides for those of authoritarian mien. Anyone can be made a non-person with a click of the mouse if their credit can be cancelled.
On the other hand…
Obviously nobody can mention any of this without the Blockchain sidling onto stage. There are no crypto tenners. If these parallel currencies are to gain ground, cash is their enemy. How far is the anti-cash movement backed by the crypto crowd?
In any case, would there ever be support for this change in the current climate of distrust for institutions and the people that run them? I doubt it. That’s doubly true because of the unstable nature of IT systems (add your own example here), including big ones such as those used by banks and finance ministries, and their obvious value as hacker targets. In a world where there is a UK majority for quitting the EU, what do you think would be the result of a referendum on abolishing those sheets of paper with Her Majesty’s likeness on them?

About Martin Ince

UK-based science and higher education journalist, big strengths in universities and university ranking, futures, media strategy and training, Earth and space sciences
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