World on 'slow but steady march' to digital money

World on 'slow but steady march' to digital money

The world is on a slow but steady march towards digital money, according to a report from Citi and Imperial College London which says that the move away from cash will bring hundreds of millions of people into the formal economy.

In their latest Digital Money Index, Citi and Imperial rank the "readiness" of 90 countries for adopting non-cash payments based on each nation's level of government and market support, financial and technology infrastructure, amount of digital options, and the population's propensity to adopt.

For the third year running, Finland tops the table, followed by Singapore and the US, while Chad, Angola and Ethiopia bring up the rear. The index also splits the countries into four clusters representing different stages of readiness: materially ready, in transition, emerging, and incipient.

Examining the members of each group and comparing their readiness in 2015 to 2014, the report concludes: "Clearly, improving digital money readiness and driving adoption is not a quick fix — this requires commitment for the long haul."

But the long slog is worth it, says Citi, because a 10% increase in adoption could help up to 220 million people enter the formal financial sector shifting $1 trillion to the formal economy and boosting tax take by $100 billion. Meanwhile, $120 billion would be saved just in lower retail cash handling costs, while billions of dollars more could be saved if governments digitised their disbursements.

Comments: (4)

Bo Harald
Bo Harald - Transmeri, Demos, Real Time Economy Program,MyData - Helsinki Region 26 January, 2016, 20:351 like 1 like

Natural developement - should be speeded up and priced transparently

 

Bo Harald
Bo Harald - Transmeri, Demos, Real Time Economy Program,MyData - Helsinki Region 26 January, 2016, 20:361 like 1 like

Blogged about it: http://www.finextra.com/blogs/fullblog.aspx?blogid=12134

Kevin Johnson
Kevin Johnson - First Hawaiian Bank - Honolulu 26 January, 2016, 21:08Be the first to give this comment the thumbs up 0 likes

Quite the reverse here in the colonies with TSYS reporting a 41% increase in cash transactions 2015 over 2013, from 17% to 24%.  Quite a sobering statistic in light of several banks calling for the end of cash.

John Candido
John Candido - Black Cabs - Melbourne 27 January, 2016, 07:34Be the first to give this comment the thumbs up 0 likes

If anything is going to lead societies to a cashless future it will simply be national governments introducing digital currencies. It will be the rise of fiat national digital currencies combined with a decline of Bitcoin and other non-official digital currencies. Bitcoin and other digital currencies will be declared illegal by governments, despite the fact that those same governments will be using the technology of the 'distributed ledger' or 'blockchain' in their own digital fiat currencies in future. 

I have blogged on the inevitable rise of national digital currencies globally as well as Bo Harald above.

http://www.finextra.com/blogs/fullblog.aspx?blogid=11989