12/01/2010

Get ready for a cashless society.

Visa Debit logoImage via Wikipedia
Are we ready for a cashless society?

Visa, the payments company, believes that if not the world at least U.K. is primed and ready for cashless transactions.

Visa believes that the cost of cash to society is unnecessary and cites numerous independent papers by consultants and national governments, to construct a compelling case.

For example, “The EC estimates that cash accounts for more than two-thirds of the total cost. McKinsey, the consultants, have estimated that "society spends about €200 (£180) a year per person to cover the cost of cash" and the "real" cost of cash to a retailer is 1.3pc of the purchase price – no less than the transaction fee on a card. The Dutch central bank has published a similar study, estimating the annual cost of cash at €300 per family.

Because cards are less risky (the associated cost is estimated at 0.02pc-0.1pc per transaction on cards compared with 0.1pc-0.2pc with cash) and encourage spending, they are more efficient and better value, Visa argues. Furthermore, card transaction fees are expected to fall, with some countries in Europe such as Denmark already offering free debit card services to retailers”.
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