For Finextra's free daily newsletter, breaking news and flashes and weekly job board.
I know its been said thousands of times before, but the one thing cash is
not is a payment method with an audit trail. The black economy has thrived on cash ever since it was invented as an alternative to bartering. As the saying goes "as long as there is sex, drugs and taxes cash will still be king".
Keith your are indeed correct. However, cash is about to get an audit trail! The changes to the
Electronic Money Directive (EMD) that come into effect on the 30th April 2011 have already contemplated this and there will be systems available in the UK very shortly that can deliver this, so watch this space…
I agree with the overall thrust of Nick's blog that "the move towards a cashless society is just that" but I strongly disagree with some of his comments about the cost of cash. The European Commission's figures for the cost of cash appeared in December
2005 as part of the EC's Impact Assessment for the PSD, and in any case referred to other estimates; while the McKinsey reports relate to 2008 and the stated cost to a retailer of cash (1.3%) is several times that calculated by the British Retail Consortium
(0.18% in 2009).
RBR's recent report The Future of Cash and Payments - for which I was the lead author - found that the cost of retail payments in Europe in 2008 was 1.17% of GDP, with cash costing the equivalent of 0.60% of GDP or EUR 129.50 per person. Naturally
I believe that these figures are better than those quoted above; but they were based upon detailed original analysis and calculations and have yet been proved to be inaccurate!
Founder and Chief Executive
17 Sep 2008
20 Apr 2020