“We’re all going digital” they say. Digital money is faster, more convenient, easier, etc. The probability of a risks in a cashless society may be relatively low, but when disaster strikes, the damage may be asymmetrically severe.
Look at what happened to Puerto Rico after Hurricane Maria. The entire power infrastructure went down. People needed food and necessities. Vendors were willing to sell them.
The problem, however, is that vendors demanded cash. People didn’t have any cash. Their government’s experiment with a cashless society failed…utterly. The Fed literally had to fly in cash so that people can purchase everyday goods—food, medicine, diapers, etc.
Banking institutions will tell you otherwise, however. Going cashless is about meeting customer demands; it’s about convenience; etc. Of course, for banks, going cashless means fewer employees, fewer ATM maintenance costs, and more. Going cashless also means having the power to monitor financial transactions, and more.
Here’s a smart piece on the topic.
Authored by Brett Scott, op-ed via The Guardian via Zerohedge
Banks are closing ATMs and branches in an attempt to ‘nudge’ users towards digital services – and it’s all for their own benefit
Banks, of course, tell us a different story about why they do this. I recently got a letter from my bank telling me that they are shutting down local branches because “customers are turning to digital”, and they are thus “responding to changing customer preferences”. I am one of the customers they are referring to, but I never asked them to shut down the branches.
There is a feedback loop going on here. In closing down their branches, or withdrawing their cash machines, they make it harder for me to use those services. I am much more likely to “choose” a digital option if the banks deliberately make it harder for me to choose a non-digital option.
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