Are We Headed for a Cash Free Ireland?
Ever since the coronavirus hit, there has been a worldwide surge in card and contactless payment methods. This was partly due to (now disproven) worries that exchanging cash hand-to-hand would spread the illness, and partly because of the amount of people who began shopping at home during lockdowns. For most this has been hugely convenient, but there are some drawbacks that need to be explored before the country goes completely digital.
The Stats in Ireland
As it stands, Ireland sits very comfortably in the middle of the ranking of European countries when it comes to cash versus card. There has been a steady increase throughout the 2010s of card payments and online shopping, but the pandemic gave numbers a massive boost. From 2019 to 2020 there was a 7% increase in the amount of payments made by direct debit, and a whopping 42% of card payments were made remotely. A study carried out by the Dublin Mint Office found that 66% of participants believed that cashless payment methods were more convenient than those using coins and notes. The Bank of Ireland and EVO Payment International published a report in December of 2020 in which it was revealed that almost half the population of the Republic of Ireland supported the idea of pulling hard currency from circulation by 2030, a deadline that is now just ten years away.
But notes and coins still have their fans, especially with the over-55 age group, who reportedly believe that cash transactions are more private and secure than card or online payments. In spite of this the plus-55s have still jumped from less than half to 81% of the group using contactless payment since the pandemic began.
The Stats in Europe
The popularity of contactless payment varies all over the European continent, with no one payment system winning out by a majority just yet. All that being said, there does seem to be a geographical pattern when it comes to which countries favour what. Mediterranean countries such as Spain, Greece, and Malta lead the way in cash resilience. Following close behind are other Southern European countries such Portugal and Italy. By comparison the Scandinavian bloc of countries, which comprises Norway, Sweden, and Denmark, are firmly committing themselves to a cashless model. Sweden in particular is aiming to be a completely cashless society by 2022, and services such as public transport have already stopped accepting banknotes and change. Ireland’s closest neighbour, the United Kingdom, has similarly stopped taking cash for public transport, and several shops throughout Great Britain and Northern Ireland have stopped accepting cash full stop.
Why Cashless Could Be the Future
There are many many benefits to going cashless, both from a personal point of view and a public one. In day to day life, not having to carry around wads of banknotes or fill up your pockets with coins is obviously going to lighten your step and leave you with freed up space to carry more important things. You can even take it a step further and not even carry a physical card at all! Instead you can choose to pay using your phone or a smart watch. The other benefit here is that it makes it more difficult for pick-pockets and muggers to rob you if you’re not carrying cash. Sure, they can take your card or phone, but without the PIN or password both are useless. Even if they do manage to use them, you can get in touch with your bank and put a freeze on your payments and even have unauthorised transactions reversed. Governments are interested in the idea of going cashless because it will seriously disrupt the black market, whose activity depends upon untraceable cash transactions. In fact for this very reason the European Union has announced plans to ban cash payments of more than €100,000. Additional benefits of going cash free include lower costs for governments and banks, as printing, storing, and transporting money will no longer be necessary.
But There’s Still a Case for Cash….
In spite of the pros associated with going cashless, there are some concerns attached to giving up hard currency completely. For one, there is a real and valid worry that our acceleration towards cards and contactless payment will leave vulnerable parts of society behind. In 2019 a study from the World Bank discovered that 239,000 Irish people over the age of 15 did not have access to a bank account. It should be noted that this number does not take into account the fact that those in Ireland who do hold a bank account still may not have access to online banking or even a card. This is not even to mention the many homeless people throughout the country who rely on charitable passers by for spare change. By cutting cash out of circulation without first planning how to accommodate these groups, Ireland would risk leaving behind a very vulnerable section of society and complicating local-level fundraising for communities. As well as this there is a concern attached to the idea of completely removing cash as an option from a privacy point of view because digital and card payments track and keep records of all personal spending.
A Cashless Ireland?
So is Ireland going to go cash free in the near future? Although almost half of all participants in the BOI and EVO International study felt that cash should be removed completely or in part over the next ten years, government ministers have raised some concerns. In January of this year the Irish Minister for Finance, Paschal Donohoe, stated that according to a report commissioned by the Department of Finance in 2019 found that Ireland wasn’t ready to go fully cash free any time soon. The country is not alone in having some reservations at the top about going fully digital -in both the United States and the United Kingdom recent action has been taken to protect cash transactions. In the US some states are banning cashless outlets, while in the UK the public accounts committee have given warnings about the impact of a cashless society on at-risk citizens. As recently as January 2021, the Court of Justice of the European Union stated that in the Eurozone euro notes and coins are legal tender and their acceptance as a form of payment should be mandatory. However, national law trumps EU rulings, and in Ireland shops may refuse to take cash payment as long as they clearly advertise that they only accept cards.