Cash don't disappear- that is a fact. Don't deny it. Or is it possible to replace cash with alternative low cost solution.
For laymans terms, cash is low cost payment method. But as everyone who knows thing or two behind cash, it is expensive, hard to control and unreliable payment method- but so hard to replace.
Over the centuries, cash payment infrastructure has been build. Currently it doesn't need too much installation or hardware configurations. That is the reason why cash is so hard to replace with mobile or electronic payments. Cash is really nice for consumers.
Everywhere you go, you can pay with cash.
But there is also a cost of cash. Every time merchant accepts cash, it comes a motherload of other cost with it. At the end of day merchant is counting money, carrying over to bank which count money again and then puts money to account of merchant. That
means a lot of hidden costs.
Last 20 years there has been several attempts to create low cost alternative payment models, mostly related to mobile phones. Problem is that this means totally new ecosystem with a lot of new players and lots of new investment not only payment side but
how to syncronize merchants and consumers. This egg and chicken situation where new payment system is available, but not too many merchants where you can use new method creates a situation where cash always beats new mobile payment model.
To compete with old cash model, there is a possibility to upgrade cash system to new level with electronic cash. Idea would be like this;
- I go to ATM to withdraw cash. I select electronic cash. ATM prints me paper note saying this note is worth of 100 € with scanning codes.
- I go to store and buy goods worth of 20 € with electronic cash. Merchant scans my paper slip and prints me new electronic cash slip worth of 80 € with scanning codes. 20 € of my purchase is registered to cash system and already counted as total sale of
- At the end of the day this money is send straight to account of merchant.
- Me as a consumer can use ATMs again to add up all my un-used paper slips and make it as one bigger electronic cash slip. Or using mobile phone, I can scan my slips and create electronic cash codes for other purchase.
Benefits of this system are:
- There are already ATM systems available- with slight modification ATMs could "print money"
- Mercants are already using scanning system and upgrade of electronic money software can't be too expensive investment
- Mobile apps can be build for scanning paper slips for consumers and merchants.
- Electronic cash is easier, low cost model, which can be linked to bigger systems and sociaty can follow the money movement is needed.
- If paper slip is used, it can't be reused- safety
Now you say, there will be a lot of paper slips. True, there will be paper slips but as long as whole world is not using electronic devices, there will be a need for hard currency in paper form. But it doesn't have to be real cash money, It could be electronic
money in paper slip form.