As the corona crisis continues to dominate media headlines, it is time to look at some of the potential outcomes. One possible scenario is how mobile money will become the new norm on a global scale.
The Cashless Society and Mobile Payments Vision
For years, governments and banks have begun pushing for a cashless society. In such an environment, no one uses paper bills or physical coins to pay for goods and services. Instead, everything is done through payment cards, wire transfers, and mobile solutions. That latter part currently only applies to “smaller’ transactions, with contactless options having even stricter limits imposed upon them.
The coronavirus is, in that particular regard, a welcome gift for most governments. As cash is now considered to be a “carrier” of the virus, stores are less eager to accept it as a form of payment. The longer that situation lasts, the closer the world comes to entering a cashless environment. For governments and banks, that is a positive aspect of the pandemic, which has nothing else going for it whatsoever.
Routine behaviors all over the world need to be revised due to the coronavirus outbreak. The way people pay for goods and services is one aspect in this regard. Moreover, it also seems to influence the way people communicate with one another. Everything is shifting to mobile, by the look of things. That applies as much to payments as it does to communication.
With the use of cash being discouraged, the next convenience option is likely to take its place. For now, payment cards will remain incredibly popular. They are also widely accepted in both the online and offline world. However, for merchants, the incur heavy fees which are best avoided at all times. This may pave the way for a broader acceptance of mobile payments in the years to come.
Is Cash Really That bad?
In theory, there is no reason to remove the need for cash altogether. In fact, it is the only widely accepted payment method which gives consumers a degree of financial freedom. Cash is controlled by the user directly, which means they do not have to rely on legacy systems, banks, and payment providers to ensure a transaction can be completed.
One of the reasons why cash is now being dissuaded is due to the coronavirus. Research has been misinterpreted to fit the narrative of how the virus can survive on paper surfaces for up to three days at most. As such, it is considered to be an “unsafe” method of paying, both for stores and consumers alike.
It is also worth noting that banknotes are not just “carriers” of the coronavirus either. An older piece of research confirms how paper money can contain hundreds of microorganisms. While not all of them are harmful or lethal, it makes one wonder why this payment method is still widely used.
All things considered, it is a matter of time until cash payments are on the way out. Transitioning to mobile payments makes a lot of sense under the current market conditions. However, it is still up to individual consumers and retailers to make that decision. Cash remains king in many countries, thus the transition may take longer than initially assumed.