What are the implications of a cashless society ?

[SoBoredHelpMe]

ive noticed more and more places are becoming card only and I think it won’t be long (say within 5-10years) that we will become cashless. So I was thinking of positives and negatives and the main negative I see is the lack of privacy as everyone’s spending will be recorded digitally. A major positive though is that it would make it very difficult for e.g. drug dealers to operate ?

would be interested to hear other people’s thoughts on this …..

All these people talking about frozen bank accounts… where are you getting your cash?

It won’t take long from my account being frozen for me to run out of money, cashless or not.

Cashless society would go a long way to closing the tax gap of c £32bn. An estimated 48% of this comes from small businesses and cash-in-hand payments. A further 16% from criminals, which would likely be reduced significantly as they would be paying tax on their income in a cashless society in order to launder it.

People often harp on about large corporations and wealth individuals not paying their tax, but cash in hand is the true problem.

I wouldn’t want my financial information being commercially available though, it would need to remain confidential between me/my bank/the government for me to sign up.

I'm 41 and remember using cheques frequently during the early '00s

Yes but you can always borrow a tenner from a neighbour to buy food if you are quite poor and desperate.

Yes, same here, I have a couple of "spending money" debit cards that never have more than £20-£30 on them which I use for daily spending in small shops, etc.

If I need to pay a tradesmen by card, then I'll do an online transfer on my phone app from my main account to a spending money account for that amount and then use it to pay him via his card machine.

If one of those cards should get cloned or stolen, then the thief isn't going to be able to spend more than a small balance on it. I get notifications to my phone every time one of those cards is used, so I'd know straight away and could cancel it via phone app immediately I notice it's gone or I'm pinged with a transaction I didn't instigate.

Far more secure than having cash with me that I'd lose permanently if I lost it or it was stolen. In fact, when in Rome a few years ago, I had my purse stolen. Obviously the cash was gone, never to be seen again, but it was interesting that the thief didn't even try to use any of the cards!

I never take the card out with me for my main account which has a lot of money in it.

This is such a thought provoking comment - like a Black Mirror episode I saw once where the credit was linked to "likes" on a social networking app. Low likes, poor housing offerings, crappie rental cars etc.

Thankfully you are wrong and it will not happen for the negative reasons mentioned.

All these people talking about frozen bank accounts… where are you getting your cash?
Friends and family. There is no right of appeal, the banks don't even have to mention why its frozen and that's the scary thing. If its your only account then you can't pay your mortgage or your electric bill etc, and nobody, not even your MP, can find out the why, its all secret and can last many months.

Google it, its mentioned in mainstream press and money websites, and its happening more frequently.

Why watch Black Mirror. Just do business with Chinese companies.

Personally, anyone I could borrow cash from would be happy to take me to the shops and buy a food shop for me. Or order an online shop to my house…

I accept the point, but £10 here and there from neighbours isn’t going to last me and my frozen account very long. To me, the pain of a frozen account doesn’t feel significantly more if cash doesn’t exist - it would be catastrophic to my life either way.

The naivety that people think that going cashless will catch all those dodgy tax evaders like the local hairdresser mum who'll do you're child hair for a fiver while you're there will make any difference when we've got billionaires paying super low taxes.....

Cashless will only benefit those at the top....

I have a friend who works for a posh carpet fitting company but he'll do you a carpet for cash - that's his beer money / extra holiday cash / take the kids bowling etc. He won't do it if it's all through the books as it's not worth it for him.

Imagine that scenario for 50% of trade people? Water leak on a Friday.... no one will come out for a quick fix. You'll have to book in and pay full call out rates....

The knock on effect for pubs / leisure will be massive.

The drug dealers are already all over cashless / crypto etc so they won't care.

So many people think they pay by card for most things so they're ok.

As pp have said, what about people who are financially controlled? I had a cheeky McDonald's the other day and paid cash. Sure as hell if it had gone out of the account Dh would have commented (I told him anyway but imagine if he was controlling).
My dd (9) couldn't by an ice cream at the park last week with her pocket money as was card only.

I'm starting to push back now on apps and digital stuff as I find it all quite worrying.

Agreed. But that is all true whether society is cashless or not. But I accept slightly more arduous for my family and friends to help if I have no cash (they’d need to enter their card details on to the websites I’m shopping on instead of going to a cash machine for me).

This.

It would mean your bank knows every aspect of your lifestyle, and it's only a matter of time before they find a way to monetise that.

It won't stop crime.

But how are you going to get hundreds/thousands to pay your mortgage, utility bills, etc. Surely your "friends and family" aren't going to lend you thousands to cover you for a few months of bills are they?

The real answer is to use more than one bank so if one bank freezes your account with them, you can just start using the other, get s/o's and d/d's transferred, get your employer to pay your wages into the other bank account, etc. That's a better solution than hoping friends and family have thousands spare to give you!

Ah sorry for typos. Multi tasking on a work call!

@PuggyMum

As pp have said, what about people who are financially controlled? I had a cheeky McDonald's the other day and paid cash. Sure as hell if it had gone out of the account Dh would have commented (I told him anyway but imagine if he was controlling).

Get a different online/app bank account that doesn't have paper statements etc which a controlling partner would never know about.

The tax gap is mostly those trades people thought. They shouldn’t be charging less for cash in hand - it’s illegal and immoral in my view.

My job is dealing with the tax affairs of billionaires. It’s (mostly) not as unfair as you think, and if the tax system was changed they’d pay more tax which is a totally different political issue. They’re (mostly) not acting illegally to not pay tax, and are (generally) contributing a lot to the coffers.

HMRC already have the legal right to check and access your bank account but expecting banks to flag payments is nuts and would never work.

From a tax point of view, getting rid of cash should increase the tax take because those cash jobs in hand jobs will be stopped or at least made more difficult. It should mean Income, Corporation and VAT takes all increase. Unless you're someone doing a lot of cash in hand stuff, you should benefit as a taxpayer (in theory).

No need to watch Black Mirror. Social credit already exists in China and other places.

For some of us this is common in our communities and the person can only afford a tenner, or fiver, and we go to the local shop and get essentials.

So we would probably all be willing but wouldn't have the funds.

We're relatively poor, and cash is most important in our communities.

And how do you add funds to it?

@VeggieSalsa

The tax gap is mostly those trades people thought. They shouldn’t be charging less for cash in hand - it’s illegal and immoral in my view.

Not only trades people by any means. Lots of it going on in shops, cafes, B&Bs, etc. Employees doing "foreigners" on the side in evenings/weekends. People selling duty free booze and cigarettes, people selling counterfeit goods at car boot sales and Sunday markets, etc. It's everywhere really, hence why it costs tens of billions.

The Netherlands is basically cashless. It honestly makes no difference what so ever. Most drug users organise/buy drugs via the Internet already, so it just adds a QR code to the process. With digital wallets it's still not really traceable, or you do it with a normal bank transfer labelled thnx for the beer. Plenty of people still avoid tax and old people manage to feed themselves. Benefits go into a personal bank account (don't they in the uk?! Surely getting an envelope full of cash from the post office is even more open to domestic abuse) The only annoying bit is not being able to get rid of change after a trip to Germany.

I wouldn’t want my financial information being commercially available though, it would need to remain confidential between me/my bank/the government for me to sign up.

It's not even currently confidential. Mastercard and Visa are already selling off your transaction data to interested companies.

See Mastercard's Global Privacy Notice (https://www.mastercard.co.uk/en-gb/vision/terms-of-use/commitment-to-privacy/privacy.html)

"We May Use Your Personal Information to:
Anonymise Personal Information and prepare and furnish aggregated data reports showing anonymised information (including compilations, analyses, analytical and predictive models and rules, and other aggregated reports) for the purpose of advising our financial institutions, merchants and other customers and partners regarding past and potential future patterns of spending, fraud, and other insights that may be extracted from this data. The Personal Information we anonymise may include payment transactions."

See this article from 2013 about supermarkets purchasing such data: https://www.theguardian.com/money/2013/jun/08/supermarkets-get-your-data

"Waitrose and Asda also admit analysing aggregated payment card data to monitor "customer shopping patterns" (for example, items purchased) over time. Both stress this is common practice in the retail industry and that card numbers are not connected to an individual or an address. Sainsbury's and Tesco say they do not track or monitor their customers' payment cards.

The supermarkets also want to find out what their customers are doing outside their stores. Waitrose, for example, paid data analytics firm Beyond Analysis to use "aggregated and anonymised data" about shoppers' Visa card transactions to help it decide on new store locations."

Also, the point is that there is no 'for you to sign up'. In a cashless society, you don't have the choice. That's the point and the problem. If you're happy only paying card, there's no benefit to a cashless society for you, because you can already achieve what you want. The limitation of choice will at first directly affect those who aren't 'signed up' to paying only card. Possible consequences later might affect you too.

My partner isn't controlling but I don't really want to use a card for a £5 breakfast and coffee.

I work in a bank so well aware of the options for having additional accounts but it's just easier to have a bit of cash.

I sell a few bits on marketplace so that's my pin money for these very things.