Kickstarting the Cashless Revolution
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INDEPENDENT PUBLICATION BY RACONTEUR.NET #0663 10/05/2020 FUTURE OF PAYMENTS INFOGRAPHIC BASIC INCOME SEXY PAYMENTS Distributed in 03 Digital payments are thriving, 07 Why the argument for a 08 When products are deemed but cash usage is actually on universal basic income has controversial, finding a payments the rise in some economies begun to gather speed provider can get a little tricky Published in association with CASH Contributors Kickstarting the Oliver Balch Journalist specialising in sustainability, business and travel, and author of travelogues on South cashless revolution America, India and Wales. Anna Codrea-Rado Culture and technology journalist, with work published in The New York The nationwide lockdown, which has sparked a surge in online Times, The Guardian and WIRED. shopping and cut cash machine usage by half, could accelerate the Katie Deighton Business reporter based in New UK’s shift towards a cashless society York, writing about the media and advertising industries as senior reporter for The Drum. Anna Codrea-Rado Ben Edwards Journalist and copywriter, specialising in finance, business, legal services and technology. hen the UK government It raises the question: will this step- The pandemic has already made tan- W announced closure of non-essen- change in both consumer and retailer gible changes in cashless behaviours, as Marina Gerner tial retailers on March 13, chef Ed behaviour be the tipping point that pushes evidenced by retailers and payments pro- Award-winning arts, philosophy McIlroy had to work out how to keep his the UK into becoming a cashless society? viders increasing the contactless limit on and finance writer, contributing business, a burger bar in a north London “The current crisis has accelerated the April 1 to £45. The last contactless limit to The Economist's 1843, The Times Literary Supplement pub, going. Like many food outlets, Four shift towards cashless payments among increase to £30 took two years to imple- and Standpoint. Legs became a cashless, delivery-only small community-based businesses,” says Lu ment, but this rise was rolled out in a mat- business overnight. Zurawski, retail payments lead at payments ter of weeks. Emily Hill “I didn’t want my delivery staff han- For consumers, the value proposition of Journalist and author, formerly dling cash,” says McIlroy. "It didn't feel a cashless UK is clear: convenience. “Car- working as commissioning editor at The Spectator and feature safe." Instead, he implemented an ana- rying cash is just no longer convenient,” writer for The Mail on Sunday. logue cashless payments system. Custom- says Laura McCracken, global executive ers who want delivery place their orders vice president at Wirecard. “In the near Joe McGrath through a Google Form and then pay their future, flexibility around payment along Financial journalist and editorial bill via bank transfer. While rudimentary, the customer experience will explode.” director of Rhotic Media, with Lockdown will continue work published in Bloomberg, the cashless system has enabled Four Legs McCracken sees a future in which tech- Financial Times, Dow Jones and to continue operating through the crisis. the drive towards a ‘new nology will emerge that lets customers Financial News. It has also shown McIlroy the potential for pay in the changing room or automati- permanently shifting to a cashless model. normal’ based around cally as they leave the shop. “Integration Oliver Pickup “It’s been a dream for us,” he says. of ecommerce and physical retail spaces Award-winning journalist, the decentralisation, he specialises in technology, “Before this happened, we weren't in con- will make payments a frictionless and He sees digital payments as the only retailers to offer cashback to consumers business and sport, and trol of the money coming in because we democratisation and even invisible part of the shopping expe- way of ensuring remote access to services using their Visa debit cards in areas where contributes to a wide range were using the pub’s point of sale. It’s digitalisation of finance so rience,” she says. that can withstand any disruption to tradi- access to cash is limited. “For some, cash of publications. never ideal for there to be a middleman Some of the loudest champions of cash- tional banking systems. “The lockdown will remains the only option and as availabil- between the customer and your money.” people no longer depend less societies are cryptocurrency play- continue the drive towards a ‘new normal’ ity of cash reduces, we need to find ways Prior to the pandemic, the UK was ten- on a financial middleman ers. Charles Hoskinson, co-founder of based around the decentralisation, democ- to avoid excluding these individuals from tatively edging towards becoming a cash- Ethereum and chief executive of block- ratisation and digitalisation of finance so the financial system,” says Visa’s Mundy. less society, with one in six millennials chain giant IOHK, hopes COVID-19 will people no longer depend on a financial mid- McIlory sees this in his own business, living a cashless life. While in lockdown, result in a permanent move towards a dleman for their services,” he says. which pre-COVID-19 operated out of a pub, Publishing manager cash usage across the country has halved, cashless society. Proponents of cashless societies often where he says he wouldn’t have made the Alexion Lai according to LINK, the UK’s largest ATM systems company ACI Worldwide. “Once the “The pandemic and associated lock- look to Sweden as evidence of what’s pos- call to go entirely cashless because a per- operator. A rise in online shopping and crisis has passed, going cashless will not only down will drive a revival of interest in sible. Sweden is one of the countries in centage of his customers still expect to be Managing editor Benjamin Chiou increased use of contactless payments, become the norm for many small businesses, the decentralisation and democratisation which its citizens use the least amount of able to pay with cash. But now the situation amid fears of the virus spreading via coins but also pave the way for the adoption of new, of financial transactions through ‘chal- cash in the world. According to research looks different. “The plan was to grow into Associate editor and banknotes, all contributed to the fall innovative payments services to capitalise on lenger banks’ and technologies such as from the Swedish Central Bank, only 1 per our own premises,” he says. “If that still Peter Archer in cash transactions. the shift away from cash.” big data and blockchain,” says Hoskinson. cent of Sweden’s GDP was circulating in happens, then we’ll also go cashless.” Deputy editor cash in 2018 compared to 4 per cent in the Francesca Cassidy UK and 3 per cent in the Eurozone. While businesses and consumers alike Digital content executive Taryn Brickner CASH USAGE ON THE DECLINE herald Sweden’s shift towards cash- TOP REASONS WHY CONSUMERS STILL USE CASH Head of production ATM transaction volumes across the LINK network (millions) less payments as a more secure and con- venient way to pay, it has also sparked Justyna O'Connell a national debate about what happens Design to those who can’t, or don’t want to, go Sara Gelfgren mobile. The same questions are now being Kellie Jerrard Harry Lewis-Irlam 250 raised here in the UK. % “It is now more important than ever to 67 Celina Lucey ensure no one is left behind,” says Jeni Colm McDermott Samuele Motta Mundy, UK and Ireland managing direc- of UK consumers say Jack Woolrich Cash usage had tor at Visa. There are currently 1.5 million they like to pay for already started to drop unbanked citizens in the UK, who by defi- small things with cash Art director significantly towards Joanna Bird the end of 2019 nition are completely dependent on cash. But Hoskinson believes the worry is Design director overplayed as groups such as the elderly Tim Whitlock and unbanked can also see the benefits of Although this publication is funded through advertising a cashless society. “New fintech innova- and sponsorship, all editorial is without bias and sponsored features are clearly labelled. For an upcoming schedule, tions such as app-based challenger banks % partnership inquiries or feedback, please call +44 (0)20 8616 55 7400 or e-mail [email protected]. Raconteur is a leading and blockchain technologies can give peo- 200 publisher of special-interest content and research. Its pub- ple far greater ownership over their own lications and articles cover a wide range of topics, including say they use cash for business, finance, sustainability, healthcare, lifestyle and identities and assets without depending peace of mind technology. Raconteur special reports are published exclu- on large financial institutions,” he says. sively in The Times and The Sunday Times as well as online at raconteur.net. The information contained in this publication “The poor performance of many large has been obtained from sources the Proprietors believe to be correct. However, no legal liability can be accepted for any institutions during the current pandemic errors. No part of this publication may be reproduced with- is creating a consumer culture more con- out the prior consent of the Publisher. © Raconteur Media ducive to decentralisation.” Other experts say the gains in contact- % 35 /raconteur.net less payments technologies should not come at the exclusion of improving access @raconteur say they like to have the to cash for those who continue to need it. @raconteur_london 2018 2019 2020 option of how to