‘Beginning of end’ for coins is arguable

Is the end of monetary life as we know it on the horizon? We’ve heard this before, but progress marches on, not always taking traditional ways of life with it. Now “the beginning of the end” for coins and bank notes may be at hand shortly, according to “some observers,” as reported in the March 31 Vancouver Sun newspaper.

Those observers appear to include Moneris, a payment technology company that in September 2016 predicted cash payments will represent only 10 percent of all transactions in Canada by 2030. Moneris said payments will be made primarily by credit and debit cards as well as mobile solutions.

Moneris surveys indicate physical currency makes up about 35 percent of transactions in Canada today.

“I think if anything, the 10 percent projection is conservative,” said Rob Cameron, Moneris chief product officer. “If cash gets small enough … more retailers may start turning it off. We are already seeing that; we’re seeing the airlines do that, we’re seeing parking do that, and we are seeing some quick-serve retailers starting to do it.”

The Vancouver Sun article quotes Kit and Ace spokeswoman Anna Cordon as saying Kit and Ace stores in North America, Great Britain and Australia have all gone cashless. “We don’t have phones on the shop floor, and we don’t accept cash … Our goal is to save people time and remove clutter while shopping.”

Not everyone agrees. Credit card companies charge merchants at least 1.5 percent on each transaction. Canadian Federation of Independent Business Executive Vice President recently said, “For a small business on a slim margin, these can be big costs. Customers are usually very aware of their own fees, but they are often unaware [that] when a business takes credit card transactions, business owners are paying fees, as well.”

A recent European Central Bank survey indicates that coins and bank notes are still favored for most point of sale payments. Another survey yet to be published shows that more than 75 percent of all point of sale payments within the European Union are made in physical euros. The value of these cash transactions is slightly more than half the value of all transactions.

“Even in this digital age, cash remains essential in our economy,” said ECB President Mario Draghi.

Australia is still trying to figure out if that nation is going cashless or not. The March report of the Reserve Bank of Australia indicated that Automatic Teller Machine cash withdrawals were 7.7 percent lower than for the previous January. For the past three years, the decline has been more than six percent annually.

South Korea took a big step away from using coins on April 20, when the Bank of Korea announced customers at selected stores can now receive their small change on prepaid cards rather than in cash. A recent BOK survey indicates two-thirds of those surveyed don’t carry coins, and half of those polled support a coinless society.

One of the greatest arguments posed in favor of retaining physical cash is privacy. Is Big Brother watching? Could Big Brother seize or freeze all your cash assets if all currency is digitized?

There is an ominous development on the horizon that appears to be innocent enough that could have lasting impact not only on currency and privacy, but on every aspect of our lives. Epicenter is a Swedish company that according to its website, “runs corporate innovation labs, provides fast growing digital companies flexible work space as well as knowledge and creativity through seminars and educational programs for companies and organizations that wish to learn more about digital opportunities and corporate innovation.”

Epicenter also offers its own employees the opportunity to implant a Near Field Communication (NFC) microchip that can be used the same way as is a swipe card. This includes when making purchases. Epicenter employees hold parties for those willing to get implanted.

As the April 4 Daily Mail newspaper in Great Britain points out, “While biologically safe, the data generated by the chips can show how often an employee comes to work or what they buy … And as with most new technologies, it raises security and privacy issues. Unlike company swipe cards or smart phones, which can generate the same data, a person cannot easily separate themselves from the chip.”

Epicenter is anxiously offering their NFC technology to other companies. Perhaps North Korea would like to use this technology as well?

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