Blog article
See all stories »

Are mobile phones the secret to preventing a potential cash collapse?

Cast your mind back to when you were younger and you used to get pocket money, or your first part-time job, where you were paid in cash. For me that tangible cash in my pocket felt hugely valuable and having the physical notes helped me budget and plan what I was going to spend my money on.

Of course as you get older how you get paid and how you manage your finances changes, but one factor that doesn’t change is our emotional connection to money.

Whether it’s the security of your money, managing your finances, or accessing your cash, emotional trust is crucial for each and every one of us. For financial service providers, capturing the trust of consumers is an extremely delicate balance – with an aim to deliver meaningful services which really add value to daily lives. 

The next generation of consumers are growing up in a world of flexible, non-traditional banking but for many consumers, choice and flexibility is key; knowing we can utilise different payments methods and get access to our finances securely, conveniently, and when and where we want to.

But with such a diverse range of consumer requirements is it possible for today’s banking industry to create a model that satisfies all customers, all of the time? It’s no secret that consumers are way ahead of financial service providers in their expectations of experience through technology. They expect “what is possible” to be “what they experience” yet innovation is not always being implemented at the rate consumers demand.

It could be claimed that the array of possibilities has led to the banking landscape becoming too fragmented and we’re failing to maximise on the technology we already have available. For example, as money becomes more social, should we be utilising the one piece of technology almost everyone has access to – a mobile phone – more within banking services?

The ability to enable financial inclusion through mobile transactions at self-service systems could offer the protection that’s required to ensure no-one is left behind in the race to evolve too quickly – acting as the main gateway to cash for those with digital purses.

Recent warnings show that we are moving towards a ‘cashless’ drive too quickly without an effective roadmap in place. Whether it’s paying for bills, budget management or day-to-day transactions, the recent Access to Cash report shows that more than 8 million adults in the UK would struggle to cope within a cashless society. 

There are still 1.7 billion people without bank accounts globally[i] (and 1.5 million adults in Britain[ii]), yet it’s estimated that 5 billion people have mobile phones across the world[iii].  Therefore, could our beloved mobile companions help to safeguard financial inclusion and specifically help to protect convenient access to cash for all.

Financial institutions will need to plan carefully for the right balance of cash and digital payments to serve all consumer and business groups - whatever their need or preference. This means rethinking the way cash is accessed, supplied and managed and looking at both new - and existing - technologies.  

In this process, it is important to remember that cash and digital are not mutually exclusive and should be effectively combined to offer consumers the services they demand now, and for the future.

 

[i] The Global Findex, World Bank, 2018

[ii] Financial Inclusion Commission

[iii] PEW Research Centre, 2019

2674

Comments: (0)