Inside the war for our wallets

When was the last time you chose to use cash to pay in a shop or restaurant? Now compare that to the last time you were forced to pay by card at a cashless business. Chances are that the latter happened more recently than the former.

Cards and contactless payments are increasingly becoming the default or only way to pay and the decline of cash can feel inevitable. The narrative goes that this change is being driven by consumers’ expectations for convenience. However, this interpretation ignores many of the 'top-down' influences that are actively making cash an inconvenient option for many. The transition to a cashless society is not welcomed by all. Many people prefer cash or even depend on it to manage their finances.

This was the topic explored by our Cash census report published in March and the Cash, cards, crypto: inside the war on our wallets event hosted by campaigner and monetary anthropologist Brett Scott in July. By bringing together the key insights from both the report and the event, I’m hoping to highlight the forces shaping the 'war on cash' and the risks it poses to some of the most vulnerable in our society.

Digital payments: who are the key players?

Digital payments were once run by banks and payments messaging organisations like Visa and Mastercard. However, with the rise of smartphones and the merge of the tech and banking sectors, new players have entered the area. Today, digital payments are a complex and interconnected ecosystem, powered by banks, payments messaging giants, FinTech companies and Big Tech players like Apple and Google.

These organisations have created new digital platforms where we access, manage, and spend our money. Their business models are designed around providing this service. As such, they all have a commercial interest in encouraging more people to drop cash in favour of digital payments. These commercial interests are rarely interrogated as part of the narrative surrounding the decline of cash. Instead, the narrative perpetuated by banks, tech companies, government, and media, identifies consumer convenience as the main driver of change.

According to Big Tech and Big Finance, people just want to make quick and easy payments. Drawing out cash and holding onto your change is inconvenient. Whereas a quick click and tap to buy your morning coffee is far easier….

'Convenience is king' is not all that it seems

As part of our Card, cash, crypto event, Brett Scott argued that this 'convenience' isn't created innocently.

As Brett said during the event:

A narrative that centres on consumer convenience as the main driver in the decline of cash ignores many of the top-down factors that are coming from the companies running digital payments infrastructure: the banks, new FinTech companies and Big Tech.

These top-down pushes can come in many different forms and frequently come together in a knock-on chain of events. For example, when bank branches close or discontinue cash machine services, it limits the number of people who can access cash in the area. Local businesses may also struggle to find branches to bank their daily cash takings, perhaps prompting them to stop taking cash altogether. A rise in cashless businesses would lead to fewer people drawing out cash at local cash machines, leading more services to be scaled back due to lack of demand. An arts centre bar in Berkshire was forced to go cashless in July 2022 because of exactly this situation.

These top-down forces are also at play within initiatives and organisations that promote the benefits of digital payments and the convenience of a cashless society, such as the Better Than Cash Alliance. This alliance is a partnership of governments, companies and international organisations that aim to accelerate the transition from cash to responsible digital payments to help achieve the UN Sustainable Development Goals. As Brett pointed out in the recent event, payments messaging giant, Visa, and the successful Norwegian mobile payments application, Vipps, are both funders of the alliance and stand to gain from the decline of cash.

Digital payments and the data they bring

When people run their lives on digital payments, they are generating a wealth of information about their spending habits and lifestyle choices. This data can be a hugely valuable resource for the companies that run the digital payments ecosystem. With access to such large volumes of data, finance and big tech companies can enhance customer base segmentation to personalise offers and even anticipate our decisions via predictive systems. The ways this data is gathered, interpreted and applied by big finance and tech firms brings new concerns to existing conversations around data privacy in the digital sphere.

There is also the threat of social control. Digital spending can be restricted based on certain information that organisations hold on you or assumptions they may have made with that data. In his new book, Cloudmoney, Brett highlights the example of an Australian welfare card that blocks its recipients from spending at non-approved retailers.

What about people who depend on cash?

Our cash census report, illustrated that there are many people who still depend on cash and will be increasingly negatively affected as digital banking and payments continue to dominate the way we make payments and manage our finances.

The report highlights how the numbers of people using digital payments have risen since 2019 but the numbers of people who would feel left behind in a cashless society remains the same as 2019 levels. One in five people say they would struggle to cope in a cashless society and over half of the population say it would be problematic to them if there was no cash in society. The report highlighted that a quarter of people still depend on cash for budgeting and how forcing people to move to digital payments without extra support could lead to a loss of control over finances and spiralling debts. Digital banking and payments also require an internet connection and basic digital skills, so groups who are already struggling with both will also be negatively impacted if cash and in-person banking become a thing of the past.

Ideological messages are also pushed by major corporations to create a sense of shame around using cash. Brett gave the the example of a campaign from Visa Europe, launched in 2016, that led with the slogan 'Cashfree and Proud'. This was part of a broader and aimed to make cash seem 'peculiar' by 2025.

Like the report, Brett Scott also highlights the huge potential of cashlessness to exclude societal groups who are already struggling. In major cities like London, cash-free shops and businesses are on the rise and tend to cluster in certain neighbourhoods. Brett describes how a kind of duel economy can form where anyone who doesn't want to or is unable to use the banking sector for payments are shut out of the whole neighbourhood.

Supporting and protecting cash users

Viewed together, these forces and trends have been described as the 'war on cash'. Some might argue this is sensationalist language, but it at least acknowledges the active forces that are shaping our relationship with cash. Viewing the decline of cash as inevitable and something solely driven by consumer preference for convenience is a far too simplistic way to interpret a huge societal change that can have a vast impact on the daily lives of some of the most vulnerable in society.

By identifying and acknowledging the forces shaping the decline of cash, added regulations and protections can be put in place to protect these groups.

Our identified three key areas that should be addressed via changes to policy and practice:

1. Keeping cash infrastructure viable, avoiding cash deserts, and ensuring people can access cash near where they live and work.
2. Maintaining cash acceptance, particularly for essential government services such as school dinners, council tax and utilities.
3. Supporting people with the digital transition through upskilling and recognising the internet as an essential utility to protect people from being disconnected.

In November 2020, New York City put exactly these kinds of protections in place with the introduction of legislation banning businesses from refusing cash payments. Legislators cited the discriminatory nature of cashless businesses as evidence behind the policy.

This example from New York City shows that policy can certainly be used to protect those who may be disadvantaged by the disappearance of cash. It is time for other governments and local authorities to listen to communities and local businesses and consider the best plan of action to help and support those who may need it.

Find out more and get involved

You can find the RSA's report on the use of cash in an increasingly digital economy by visiting The cash census page.

Hear from Brett Scott, author of Cloudmoney by revisiting our Cash, cards, crypto: inside the war for our wallets event.

Find out more about the work of the RSA's global Fellowship and how to get involved by clicking below.