A Cashless Future? A Tally Of The Benefits And Risks

Article

Raquel C. Pico

Exchanging currency before traveling could soon become a thing of the past. Banks even recommend not exchanging too much money before trips from Spain to the United Kingdom, suggesting that travelers could go entirely cash-free. Once at their destination, spending the pounds exchanged becomes tricky: many places no longer accept cash, and those that do often require the exact amount.

UK Finance estimates that only 12% of all payments in the country in 2023 were made with cash, a figure expected to fall to just 6% by 2033. Although cash use has risen slightly year on year, overall it has been declining since 2014. Shops are legally allowed to refuse cash, and earlier this year, UK Treasury Minister Emma Reynolds confirmed they will not be forced to accept coins and notes — although she stressed this does not mean the country is going fully cash-free.

In many countries, paying for nearly everything by card or mobile app has become the norm. It is convenient, simple, and provides easier traceability of payments. Spain is a clear example: before the pandemic, some shops and bars still refused cards or imposed minimum amounts. Now, card payments are ubiquitous, often preferred even over medium or large cash bills, which can leave shopkeepers short on change.

The latest statistics from the Bank of Spain confirm that, although cash remains the most common payment method, its everyday use is declining. By the end of 2024, 59% of the population paid regularly with cash, compared to 30% with cards and 11% with mobile phones. Habits vary: Women tend to pay more by card than men, older people rely more on cash, and younger people prefer mobile payments. Card payments are now accepted in 92% of shops.

The death of cash has long been predicted, and the increasing digitization of society keeps pushing it closer. For younger generations, paying with a device has become almost instinctive—the real surprise is when they actually have money in their wallets.

The risks of a cashless future

Among the benefits of a cashless society are efficiency, speed and accountability. Yet the transition also has its downsides, as a few practical cases have already shown.

One notable example is Sweden. The country is frequently cited as a model cashless society, so much so that a few years ago one of its ministers predicted cash would disappear by 2025 — but it hasn’t. Many Swedish stores and services no longer accept cash, and card or app payments are the default preference. Since promoting the change in 2012, the number of coins and bills in circulation has been halved, and in 2017, Sweden became the least cash-using country in Europe (Sweden and Norway currently lead this ranking globally). Only one in 10 purchases is made in cash.

Yet this shift has worsened inequality, leaving the most vulnerable — those without bank accounts, technological know-how, or stable housing — excluded. Research shows it harms their quality of life and makes them feel criminalized.

When technology fails, without the necessary coins, you wouldn’t even be able to buy a loaf of bread

Similarly, the major blackout in Spain this April showed many people who never carry cash what can happen when technology fails. You might have all the money in the world in your bank account, but without the necessary coins, you wouldn’t even be able to buy a loaf of bread.

The European Union’s «survival kit» actually recommends keeping cash at home, saved for emergencies. Even countries that had made great strides toward eliminating cash are now reconsidering, questioning whether this shift leaves them vulnerable amid emerging risks.

According to UK daily The Guardian, Sweden’s civil defense plans are now encouraging a return to cash as a precautionary measure. Meanwhile, Norway passed a law last year penalizing businesses that refuse cash and also recommends keeping emergency cash at home.

This content is part of a collaboration agreement of ‘WorldCrunch’, with the magazine ‘Ethic’. Read the original at this link.