Why Are Banks So Eager To Shift To A Cashless Society?

These days, the banking industry is calling on their users to use digital banking payments instead of cash. According to research, some of the more economically developed countries, like Sweden and UK, will move to a cashless society by 2020. However, why are banks so eager to call on their customers to stop using cash?

At first, many states and cities banned cashless businesses including cryptocurrencies and this forced some companies such as Amazon, to quickly go back to using and accepting traditional money. 

Now, the outbreak of Coronavirus pandemic has left no stone unturned in many different sectors including the health, financial, payment and banking industry. Banks are eager to go cashless. The shift towards a cashless society is more likely to cause a significant boom in the values of gold, Bitcoin and other digital currencies. 

Digital money for digital era

The Covid-19 pandemic has forced many people to use cashless payments methods such as bank transfers, mobile money, Bitcoin, checks, cryptocurrency, credit cards, and many others, to avoid bills or money-coins from being handed from one people to another.

As governments ease the lockdown, business and other activities have started to reopen, and most of them are actually developing cashless protocols to enable their clients to avoid coming into contact with infected bank notes, and also reduce their worries about the spread of the virus.  

Most countries including Sweden, Canada, United Kingdom, United States, etc., are shifting to a cashless society. Several countries including Japan (digital yen),  Britain (Britcoin), the US (digital dollar), China (digital yuan), Russia (BitRuble), etc., are considering developing their own state-backed central bank digital currencies (CBDC). Although it would be much more centralized than most cryptocurrencies, it might have the potential to completely disrupt traditional finance and shift it to the digital realm to keep pace with the general digitization trend.  

Going cashless

Other reasons why banks, individuals, and companies are eager to go cashless is that cashless transactions are faster compared to the traditional means of payments. Swiping a credit card over a terminal is more secure, fast, convenient, easy, and transparent than counting the bulk of paper money. Businesses, individuals, and companies would therefore be saving time that they use to line up in the banks, protecting money from armed thieves, handling or transporting money.

Banknotes (in cash registers, bank counters, bags, etc.) have been attracting thieves to break into where the money is kept and then steal it, so if banks and companies shift to cashless payments, the rate of theft will reduce significantly. Cashless payments will also be better and easily traced and tracked.

Updated by: Coin Idol