It’s becoming increasingly apparent that, for better and worse, the COVID-19 pandemic has altered some things irrevocably.
The better mostly subsumes public autonomy, while the worst mostly refers to cultural stability. Occasionally points converge productively.
Although no outcome can justify the 32 million people who succumbed to COVID-19 around the world, there is one major development that signifies a thin silver lining.
Even before the novel coronavirus, Americans were beginning to move away from cash–this was especially true of younger generations.
With a health crisis that survives on contamination, an already growing majority of financial transfers is fattening.
“Sooner than we thought, we will be moving away from the possibility of literal dirty money, meaning legal cash tender,” technologist and cybersecurity expert, Joe Raczynski recently explained. “Believe it or not, the US was on the cusp of issuing a digital dollar on at the end of March. As part of the early draft for the COVID-19 stimulus package, bold and powerful policymakers vied for the creation of a Digital Dollar.”
So what does this mean?
-Firstly, The World Health Organization and the Centers for Disease Control and Prevention agree, contactless forms of payments are the safest ways to engage in commerce, with the latter encouraging retailers to “encourage customers to use touchless payment options, when available.”
-Digital payments are much easier to track than cash payments. The Better Than Cash alliance adds, “cash-based transactions are typically expensive, inconvenient, inefficient, and lack transparency for governments, companies, and citizens alike.”
According to WHO, “When digital payments—whether on mobile phones, cards, or online —become available to everyone, everyone in the economy can benefit from the outcomes.”
-The most substantial way to build capital is by securing major purchases with a credit card.
“Credit cards offer one of the best ways for you to build your credit and improve your credit scores by showing how you manage credit on a regular basis,” financial expert Louis DeNicola explained.
Currently, Millennials and Gen Zers are driving the digital shift the most profoundly.
According to the federal reserve, 28% of payments are made via debit cards, 26% are made with cash, and 23% are on credit cards.”
However, a new report from The Travis Credit Union signals a dramatic upturn.
“We recently surveyed Americans to learn more about their relationship with cash, and we found that respondents are now twice as likely to use a debit or credit card instead of cash to purchase goods. In fact, one in five said they rarely or never carry paper bills,” the researchers wrote. “Before we can think about a cashless future, however, we have to understand our present habits. Fewer than one in five respondents (16%) said they always carry cash, while 27% said they carry it most of the time, and 37% responded ‘sometimes.’ When Americans do have cash on their person, they’re carrying an average of $46.”
In totality, there are many compelling arguments in favor of a cashless world.
Economic growth occurs the quickest when citizens can tract the impact of their transactions.
When populations know where their money is going, they can better budget their finances, prioritize their needs, and contribute the excess to markets integral to economic stability.
“A study conducted by Moodys reported that between 2008 and 2012, greater usage of digital payments added $983B in global economic growth, which is the equivalent to creating 1.9M jobs,” the Better Cash Alliance concludes. “Financial inclusion has been broadly recognized as critical in reducing poverty and achieving inclusive economic growth. Greater access to financial services for both individuals and firms may help reduce income inequality and accelerate economic growth, according to the World Bank.”