The Death of Dollars, Cents & Freedom? The Cashless Society

As writers we have the wonderful opportunity to explore how today's changes may effect the world we live in.  Some even argue we have a duty to explore these changes.

We've all heard (I hope) of the coming of a cashless society in which all transactions, even person to person transactions - are conducted with plastic - or apps on a cell phone.  Convenient, yes.  Private?  

Already anyone with a cell phone can be tracked and located by the codes transmitted by your cell phones and other devices.  Today, people are convicted of all sorts of crimes based on mapping of their cell phone's travels.  Many people have been convicted of crimes by reconstructing not only their purchases, but their travel patterns through credit and debit card transactions.

What happens to our privacy when every transaction we make can only be made electronically? Today a person can drop out of sight by paying only in cash - something becoming more rare and harder.  Will this be possible when cash no longer exists?  If so, how?

Whatever freedom and privacy of movement we now have could well be gone with large corporations and governments knowing where we are at any moment.  Remember the old saw, "If it's possible, it will happen."

Here are two recent stories on the subject, with links to the sources in the attribution.
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Ten more years of real money?

We will be using "real" money for at least the next 5 to 10 years, but financial transactions carried out using mobile electronic devices, such as smart phones and tablet computers, will increasingly become the norm during that time period, according to research published in the International Journal of Electronic Business.

Key Pousttchi and Josef Felten of the University of Augsburg and Jürgen Moormann of Frankfurt School of Finance & Management, Germany, explain how social media and mobile devices are being utilised increasingly by banks while the power of the individual customer is being augmented by the same technologies. Moreover, those technologies are also leading to novel financial services such as online bartering systems and virtual currencies, crowd funding and online social borrowing and lending. Given that the banking sector was among the first industries to widely adopt information technology -- everything from financial planning and credit-decision systems to automated teller machines -- none of this is any surprise.

However, in order to understand future trends, the team has carried out a Delphi study, a systematic and interactive forecasting methodology, the results of which suggest that mobile finance will continue to grow during the next decade in retail banking, but conventional transactions will remain largely predominant for at least another 5 to 10 years. Underpinning the evolution of finance is the perhaps too slow recognition by financial institutions that the relationship between customer and bank remains important and especially so in the age of social media and networking. In that era, everyone's opinion can count and a simple mistake or disinterest on the part of a corporation can become today's "viral" news story and a possible step down the road to ruin for the unwary company.

The team's study demonstrates that complex issues will continue to be dealt with through direct, personal communication while standard processes will be subsumed by new media tools providing customer and bank with the new typical form of access.
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Sweden on track to becoming the first cashless nation

Sweden is on its way to becoming the world's first cashless society, thanks to the country's embrace of IT, as well as a crackdown on organized crime and terror, according to a study from Stockholm's KTH Royal Institute of Technology.

Niklas Arvidsson, an industrial technology and management researcher at KTH, says that the widespread and growing embrace of the mobile payment system, Swish, is helping hasten the day when Sweden replaces cash altogether.

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Swish, an app owned by six Swedish banks, can soon be used for ecommerce transactions. The payment solution that enables consumers to make real-time payments using their mobile phone has introduced a consumer-to-business solution and now wants to expand its service to the ecommerce sector.
It’s been over two years since six Swedish banks (Danske Bank, Handelsbanken, Länsförsäkringar Bank, Nordea, SEB and Swedbank) joined forces and launched a mobile app called Swish. Its goal was to let consumers use their mobile phones to make payments and transfer money to someone else’s bank account. The money gets sent in real-time between the bank accounts and consumers subscribe to the service via their bank.
Swish is primarily being used for transfers between two persons who want to split the bill or for paying back debt in everyday life. But in July 2014 it expanded its service so it could also be used by businesses. And now the next step is introducing Swish into the Swedish ecommerce industry.
Source:  ecommercenews.eu/
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The End of Money:
Counterfeiters, Preachers,
Techies, Dreamers -
And the
Coming Cashless Society


by David Wolman

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Powell's Books
"Cash is still an important means of payment in many countries' markets, but that no longer applies here in Sweden," Arvidsson says. "Our use of cash is small, and it's decreasing rapidly."

In a country where bank cards are routinely used for even the smallest purchases, there are less than 80 billion Swedish crowns in circulation (about EUR8 billion), a sharp decline from just six years ago, when the total in circulation was SEK106 billion.

"And out of that amount, only somewhere between 40 and 60 percent is actually in regular circulation," he says. The rest is socked away in people's homes and bank deposit boxes, or can be found circulating in the underground economy.

The result of collaboration between major Swedish and Danish banks, Swish is a direct payment app that is used for transactions between individuals, in real time. The service's direct collaboration with Bankgiro and Sweden's national bank, Riksbanken, is a critical factor in its success.

But if Swish starts to be used on a larger scale and grow to include retail transactions and e-commerce, Arvidsson says it is likely the country's entire payment system infrastructure will have to be revamped.

That may not be as prohibitive an idea as it sounds. Arvidsson says Swish is already revolutionizing the banking system, which itself is no stranger to bold digital projects.

With digital giro systems, early electronic payment services and other advances in online financial services, Swedish banks have been early adopters of advanced IT systems, he says.

"Combined with a strong IT sector, this has led to more competitive financial services in Sweden. The success also depends on the Swedish consumer tradition of welcoming electronic payment services."

Besides simplicity and lower costs, digital payments also add transparency to the nation's payment system. Several banks in Sweden already have 100 percent digitized branches that will simply not accept cash.

"At the offices which do handle banknotes and coins, the customer must explain where the cash comes from, according to the regulations aimed at money laundering and terrorist financing," he says. Bank staff are required to file police reports in response to suspicious cash transactions.

In spite its popularity, Sweden will still have to ensure that all people are able to participate in the new payment system, Arvidsson says. The transformation would present serious challenges for those who are unfamiliar with computers and mobile phones -- mainly older people living in rural areas.

Other segments of the population likely to feel the impact are the homeless and undocumented immigrants. In a society without notes and coins, they will be even more at the mercy of government systems to survive

Whether cashless societies spread beyond Sweden is another question. "Swish is a brilliant idea, but to introduce it internationally is a challenge, not least because it takes a long time to change other countries' banking systems from scratch. But it is not impossible that a Swish-based banking revolution can also occur abroad," Arvidsson says.

Story Source:  
  1. Materials provided by Inderscience.  Key Pousttchi, Jürgen Moormann, Josef Felten. The impact of new media on bank processes: a Delphi study. International Journal of Electronic Business, 2015
  2. Materials provided by KTH The Royal Institute of Technology. "Sweden is on track to becoming the first cashless nation." ScienceDaily, 13 October 2015

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