Whether it is a wallet packed full of receipts or just a money clip with crisp folded 20 pound notes, a wallet can tell you a lot about the person. With the emerging technologies, could the days of carrying a wallet or a purse become a thing of the past?
Within the UK, our cash usage habits are summarised as follows:-
- Lower social economics groups carry more cash (income lower than £10k pa)
- The north has a higher percentage of people who carry cash than the south.
The possible alternative methods could be:-
- Debit cards and credit cards – increased usage and lower payment thresholds
- Prepaid cards
- Mobile payments – Mobile payments are preparing to go mainstream. Nearly one in five respondents say that mobile payments are very important today. (KPMG 2011 Mobile Payments Global Survey)
Contactless transactions. The roll out of contactless terminals in the UK for use with a new generation of credit cards has been an integral part of the build up to the 2012 London Olympics (http://www.barclaycard.co.uk/visa-olympics-tickets/) and we wait to see how successful it will be. This type of technology has been available since the 1990’s in the form of the Mondex Smart Card (http://www.tech-faq.com/mondex-smart-card.html) but has still to find widespread usage partly due to security fears from consumers. The exception being the Transport for London Oyster card which is used daily by millions of travellers (https://oyster.tfl.gov.uk ).
United States consumers’ use of cash declined 3 percent last year and it will continue to drop at the same rate through 2015, according to a new report by Aite Group LLC, a Boston-based consulting firm.
Overall, through 2015, the use of cash will decline by nearly $200 billion, but the drop does not signal the beginning of a cashless society because some age groups are using more cash than others, according to the Aite Impact Note study, “The Less-Cash Society: Forecasting Cash Usage in the United States.”
“Despite forecasts of a cashless society, the United States is nowhere near the realization of this vision. In fact, if the use of cash were to decline by 17 percent every five years—what our forecast for 2015 calls for—then the use of cash in the United States wouldn’t fall below $1 billion before 2205, roughly 200 years from now,” the report found.
Worldwide events such as the recession in the US and Europe are also having an effect on the use of cash with an increase in the black economy and there are reports of significant levels of bartering in parts of the Greek economy (http://www.minyanville.com/dailyfeed/2012/05/21/greeces-new-spin-on-an/) . Generally as economies fall into recession, or fail, cash becomes king again as the populace lose faith in their banks.
So to summarise, it is very unlikely within any of our lifetimes that we will be able to leave the wallet or purse at home – but the trends, do clearly show an increase in the use of alternative methods of payments which retailers will need to introduce into their stores in the very near future.