The latest news from the UK Payments Council, especially on the back of the recent
study by Market Platform Dynamics shows that the use of cash is greater than ever, despite the plethora of electronic and mobile alternatives.
For those outside the payments industry, the true cost of cash is invisible – they think it’s ‘free’, But actually, physical currency costs the economy quite a lot. After all, it needs to be minted or printed, counted, transported and secured wherever it
goes.
It was estimated in 2010 that cash payments actually cost every single person in Europe €130 (£110) a year. Of course, these figures may have altered in the last three years, but the point still remains: the true cost of cash seems to be overlooked. Furthermore,
cash can also cost us in the long-term, with it funding criminal activities or tax evasion. With there being little trail left with payments, cash is still very much the first port-of-call for criminals and gangs - although we are hearing of some moving towards
mobile payments, or even mobile POS to take payments!
This research shows that even though the financial services industry is encouraging electronic, mobile or online payments, and we see news stories every day about the latest card or app, there is still a long way to go to get rid of cash
So what is the answer? Perhaps the financial services industry needs to work together to try to encourage consumers to move away from cash, instead of doing its best to compete with who can launch the ‘latest and greatest’ mobile or electronic payment solution
– which just makes consumers more confused about all the different technologies, from different suppliers, which all work in slightly different ways.
If we want to move away from cash, the alternative has to be something that the public will understand and embrace. Instead of suppliers constantly trying to compete with one another, perhaps they should work together. The UK Payments Council’s
mobile payments project
is an example of how the industry can work together towards one goal. As one single service that consumers can enjoy, it is simple and straightforward. But this is just one step, to solve one small problem - we need more projects like it.
To move people away from cash I believe that, as an industry, it will be collaboration, not competition, that is needed. How that actually works in practice, especially across borders, remains to be seen…