By Dan Ilett, 10 February 2006 15:00
NEWS
Half of European consumers believe cash will be almost obsolete within 10 years, a study suggests.
Out of the 3,000 debit card holders surveyed, 52 per cent said Europe will be cash free by 2016 but 48 per cent said they would still carry paper and coin currency.
Eric Tomlinson, senior vice president of MasterCard Europe, who commissioned the study, said: "Our research also shows that eight out of 10 still carry up to 50 in their wallets on an average day. Cash remains the fall-back position for too many of the Europeans we surveyed.
"The challenge the payments industry faces is increasing both merchant acceptance and the level of consumer comfort with using debit for lower value transactions, to the point where people don't need to carry cash."
The survey was carried out by KRC Research a sub-company of MasterCard's UK PR company.
MasterCard is currently pushing its contactless payment product, One Smart PayPass. Using a card or token, consumers can tap a pay point to pay for goods.
Last year one silicon.com reader said people who carry contactless payment cards could be putting their money at risk.
He said: "This introduces a whole new area for fraud - why steal something when you only have to stand within reader distance of someone's wallet or purse?
"Just think, there you are, crammed on the tube - how many of your fellow passengers are surreptitiously querying your contactless credit card? Breaking the encryption of a popular credit card would seem to have a certain potential payback - enough to warrant significant effort I would have thought."
Comments
There are 7 comments. Join the discussion
1. Oscar Wilde
The rate pay rises have (not) been happening in my part of the industry of late, I would agree that cash will soon become a thing of the past. In fact, money in all its forms seems to be disappearing!
2. Mark Hosey
So, you expect every child to have a debit card, every vagrant and begger, everybody who cannot hold a bank account? And every time I want to buy a piece of chewing gum the transaction for just a few pennies will be with a card? And in the event of a failure of the telephone networks or electricity supplies shops will have to close cos they can't use the terminals that process the cards? And when I want to pay a neigbour for some small service or give cash as a gift I will have to do some juggling with my card and their account?
Get on yer bike, cash is here for a long time yet. Longer than ten years! Not that cards don't have their uses, but....... They make person to person transferers cumbersom. Also, every cash transaction is free, regardless of the state of your bank account; spending can continue until your pockets are empty without accidentally over spending and incurring severe overdraft charges (unless you have prearranged otherwise) and it's much simpler keeping track of your spending, because you can see it and feel its weight in your pocket.
Cash might be used less but I believe it will still be here in 100 years time.
3. anonymous
Don't we still have a law here that says that if you are without some cash in your pocket, you are a vagrant? As such you can be arrested and carted off for DNA recording and other time wasting things.
4. Simon
Yawn ! Same old b****ocks !
How long is it now that the end of cash has been imminent ? I still think suggestions of cash's demise are premature. Just think, what's easier, hand over a few metallic tokens (coins in everyday parlance) in return for your lunchtime sarni, or prat about with some elctronic system that takes several times as long and is less secure ?
Of course, the viewpoint stated that "Cash remains the fall-back position for too many of the Europeans we surveyed" could only come from someone with a vested interest in it's demise.
5. Nick Cole
Come on be realistic!
How do you pay for something when the bank machine is down, there is a power cut or the phone network doesn't work?
How do you pay your neighbour or anyone else in a private transaction?
What happens about low value transactions?
What happens to the few who cannot get credit cards such as children, or those deemed incapable of handling finances?
What about market traders?
What about queues and the additional time taken to pay when pins/bits of paper need to be processed?
All that has happened with an increased level of cashless transfers is a dramatic rise in the level of fraud.
Cash is a universally foolproof, low technology and proven system. It replaced barter hundreds of years ago.
There is still a place for cash especially under emergency conditions.
If all monetary activity took place electronically who would benefit? The banks of course as they would have their sticky fingered control over absolutely everything.
6. G Slater
Only cash, or possibly a cheque, will get you food when the lights go out.
7. anonymous
This will not happen for a long, not in my life and probably not even in my kids. The card credit companies charge as much as 5% of the total value to retailers for polling their CC machines. So if I was to buy a packet of gum or crisps that would not leave much profit for the retailer. The biiger stores get charged 1.5% or lower.