The cashless society
In many corners of the world, the adoption of cashless transactions has been slow and met with varying levels of acceptance. In spite of the transparency, efficiency and security of digital payments, it seems that some still feel there’s comfort to be had from having a stash of cash stored under the bed for a rainy day.
The COVID-19 effect
In my little community in the Philippines, for example, some people still find it most secure to use cash to buy goods or to pay for services. However, the lockdown due to COVID-19 changed the payments landscape radically, with online purchases accelerating at a rate nobody could have predicted.
It’s the new reality, and my folks are already embracing a cashless society with far fewer reservations—initially due to fears of viral infection via physical coins and notes, but now more so because of the convenience it provides.
I myself am no stranger to this techno-financial phenomenon, having been an e-payments advocate for a couple of years now. But with the pandemic affecting every aspect of my financial life, my cashless activities have increased significantly. They extend from simple bill payments for basic utilities to buying the most menial of household items, such as AA batteries, bedsheets, and bottles of hot sauce.
The next few years will be an exciting time for “cashlessness”. Everyone’s going digital and carrying cash is no longer a staple for buying things—even in traditionally cash-dependent countries like the Philippines. QR codes, One Time Passwords, and loyalty points will increasingly become the new normal.
And it's likely we will see further change in the near future as financial institutions increase the range of services they offer via phone apps using Open Banking, while demand grows from retail customers to use a single payment device.
According to a recent survey by Visa, 92 per cent of respondents in the Philippines would prefer to use a single app from which they can do everything – from transferring money to making a purchase online to paying bills seamlessly.
Above all, though, a cashless society will bring benefits at a community level by giving people more visibility on their cash flow and therefore increased financial security. I’m proud to be working for a company that enables banks to provide their customers with the solutions that they need, especially during trying times like these.
COVID-19 may have accelerated the adoption of digital payments, but the ability of banks to meet consumers’ evolving expectations for fast, secure mobile services will be key to their success in the years ahead.
Discover more in the Redefining Finance series