A cashless society has been on the horizon for some time now, but as the Covid-19 pandemic further propelled both consumers and businesses towards a cashless economy, what does a cashless society mean for them?
According to a 2021 article in The Guardian, official data showed that in 2020 the number of payments made using coins and notes fell by 35%, signifying a strong shift into a cashless economy.
What is a Cashless Society?
Instead of using paper and coin currency, a cashless society would implement electronic financial transactions only. This involves paying by debit or credit cards and online payment types such as ApplePay.
Advantages of a Cashless Economy
For both businesses and individuals, there are a plethora of benefits to a cashless society including:
- Save Time and Money – Cash management can be costly for businesses. Not only does using cash require adequate and secure storage, when funds are running low it may be necessary to leave the premises to access more from your bank and/or deposit funds if you have too much money on your premises. In addition to this, some businesses require specialist security firms to transfer large sums of money securely.
- Increased Efficiency – A cashless society is likely to be much more efficient for businesses, as technology enables us to manage and monitor payments much more effectively and require less valuable time from employees.
- Reduced Crime Rates – Digital transactions are much easier to keep a record of and thus it is much more difficult for money laundering and other illicit financial transactions to occur. Furthermore, tax avoidance is also much harder due to the online paper trail from digital transactions. By avoiding carrying cash, businesses and individuals are less likely to be victims of a targeted attack by criminals.
- Easier International Payments – With a cashless economy, when you travel you don’t have to exchange your physical money into the correct currency and can instead use your debit or credit card with ease.
How Businesses are Moving Towards a Cashless Society
Gone are the days where companies predominantly deal with cash. Instead, as the cashless economy becomes a more dominant force in the financial world, businesses are opting to reduce cash and card payments, replacing them with direct debit solutions, particularly when it comes to recurring payments.
From window cleaners and children’s nurseries to marketing agencies and beyond, not only are businesses using direct debit for recurring payments, they are taking advantage of direct debit solutions for one off payments too.
What Country is a Cashless Society?
Presently, there isn’t a country deemed to be a completely cashless society. However, the following countries are likely to be the first to be declared a cashless economy:
- Finland – 98% of the Finnish population possess a debit card. In 2018, Finland’s cashless transactions reached €50bn.
- Sweden – In Sweden, it’s legal for merchants to refuse cash payments despite the fact Sweden was the first European country to introduce bank notes. The country aims to be a cashless economy by 2023.
- Norway – The Norwegian central bank says that a minimal 3-5% of point of sale transactions were paid in cash, with almost all Norwegians owning a debit card (98%).
Make Your Future Cashless with FastPay
Thanks to FastPay’s advanced Direct Debit payment solutions, businesses up and down the United Kingdom are taking advantage of the many benefits associated with a cashless society.
Whether you’re a gym owner, property landlord or car dealership, FastPay can make collecting your payments as hassle free as possible.
Our friendly experts will listen to your businesses needs and support you throughout your time as a FastPay customer. To find out more about our services, contact our team online or alternatively, call 0161 737 5290.
