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Measuring Progress Toward A Cashless Society

Hugh Thomas |

There are several reasons not to like cash, but ours remains a cash-based world. The “Cashless Journey” project was undertaken to track progress towards cashless economies. The results are sometimes surprising. The journey is usually a gradual trek toward electronic payments shaped by local factors.

Cash accounts for about 85% of global consumer transactions. This remains true even as much of the world’s population is acquiring access to a multitude of non-cash options for making payments.

The burden of cash usage on national economies is substantial, representing as much as 1.5% of GDP. Heavy cash usage may also be an indicator of other economic problems.

The “Cashless Journey” study measures nations‘ progress toward more modern, efficient electronic payment mechanisms by looking at the current share of cash versus non-cash payments for consumers (Share), how this Share has shifted in the past five years (Trajectory) and whether conditions exist for cash payments to move to electronic (Readiness).

To find out more, download the full report.

Report contributors: Amit Jain, Michael Angus

Topics: Economic Outlook, Payments Strategy

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3 Comments

  1. Amru Kotb said on September 24, 2013 at 10:21 am | Reply

    It is important to understand the local culture that can facilitate applying non Cash Payment and develop the required payment strategy. In some cases it is only illiteracy that stands between cash and non-cash application in others it is about trust.

    • Hugh Thomas said on September 25, 2013 at 10:31 am | Reply

      I couldn’t agree more Amru. We’re actually finding that lack of financial literacy is an impediment to going cashless in many markets. Trust can work both ways as you know. For example, cards help to overcome the lack of familiarity and trust that comes from buying things online from a stranger miles away. We become the preferred instrument in such cases because the buyer can trust that they will get what they were sold, or not have to pay (a guarantee not available when paying with cash).

      • Amru Kotb said on September 26, 2013 at 3:22 am | Reply

        Absolutely Hugh, there should be more energy dedicated towards reducing this financial illiteracy (education) and incentives those who use non cash payments.. One of the ways is to focus on younger population, understands their needs and develop the strategies to meet those needs. MasterCard has some impressive projects in Africa for instance. I believe that those can be doubled by widening the scope and overcoming regulations’ hurdles.