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Cashlessness

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A presentation about cashlessness at the London Futures Symposium. Are we moving towards a cashless society? If we are, who might the winners and losers be?

Published in: Economy & Finance, Technology
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Cashlessness

  1. 1. Is it a cashless future? <ul><li>David G.W. Birch </li></ul><ul><li>ATMs & Kiosks, SMi (May 2008) </li></ul>
  2. 2. David G.W. Birch Director, Consult Hyperion, www.chyp.com Chair, Digital Money Forum, www.digitalmoneyforum.com Driver, Digital Money, www.digitalmoneyforum.com /blog Editor, Digital Mo ney Reader, www.amazon.co.uk Podcaster, iTunes store, search “ consult hyperion ” Blogger, 15Mb, blog.dgwbirch.com Author, Digital Identity Management, www.gowerpub.com Columnist, Financial World, www.financialworld.co .uk
  3. 3. The future of money <ul><li>Edward Bellamy and the first “credit card” </li></ul><ul><ul><li>Looking forward by looking back </li></ul></ul><ul><ul><li>Actually it was a pre-authorised offline debit card, but let’s not let that get in the way of the story </li></ul></ul><ul><ul><li>Remember the shocking question! </li></ul></ul><ul><li>If you make pens </li></ul><ul><ul><li>…you don’t predict PINs </li></ul></ul>V1 (4/08)
  4. 4. Is it a cashless future? <ul><li>What’s wrong with cash? </li></ul><ul><li>Is there any data? </li></ul><ul><li>Can technology do better? </li></ul><ul><li>The winners and losers </li></ul>
  5. 5. Cash <ul><li>Bits about atoms </li></ul><ul><ul><li>Banking babylon and the end of the Pony Express </li></ul></ul><ul><li>Bits about bits </li></ul><ul><ul><li>The fiat currency era </li></ul></ul><ul><li>Discontents </li></ul><ul><ul><li>What’s not to like from the “left” and “right” </li></ul></ul>
  6. 6. Bits about atoms <ul><li>Giro banking, goldsmiths and gold standards </li></ul><ul><li>Notes and coins are a tiny fraction of money </li></ul>V1 (4/08)
  7. 7. Bits about bits <ul><li>Tricky Dickie and the fiat currency era </li></ul><ul><li>Cards, cash machines and cash management accounts </li></ul><ul><ul><li>Innovation in action </li></ul></ul>V1 (4/08)
  8. 8. Discontents and digital money tribes <ul><li>Hayek and the crusaders </li></ul><ul><ul><li>Denationalisation </li></ul></ul><ul><li>Idealists left and right </li></ul><ul><ul><li>Ron Paul and the echoes of bimetallism </li></ul></ul><ul><li>Determinists (like me) </li></ul><ul><ul><li>Mobile phones and means of exchange </li></ul></ul><ul><li>Non-bankers </li></ul><ul><ul><li>P2P </li></ul></ul><ul><li>Businesspersons </li></ul><ul><ul><li>De Bono and the IBM dollar </li></ul></ul>V1 (4/08)
  9. 9. Data: developed countries <ul><li>Europe </li></ul><ul><ul><li>Efficiency and the euro </li></ul></ul><ul><li>US </li></ul><ul><ul><li>Check mate </li></ul></ul><ul><li>Japan </li></ul><ul><ul><li>Land of the rising phone bill </li></ul></ul>
  10. 10. Europe <ul><li>More euros than dollars </li></ul><ul><ul><li>In “circulation” </li></ul></ul><ul><li>Social costs vs. costs </li></ul><ul><ul><li>Estimated at 0.5% of GDP </li></ul></ul><ul><li>Cost-based pricing </li></ul><ul><ul><li>Target 1 in 4 transactions on debit card </li></ul></ul>V1 (4/08)
  11. 11. US <ul><li>Most cash is outside U.S. </li></ul><ul><li>Proxies indicate cash usage peaked a decade ago </li></ul>V1 (4/08)
  12. 12. Japan <ul><li>40m mobile wallets </li></ul><ul><li>1 in 6 mobile subscribers use contactless </li></ul><ul><li>5m PC interfaces already sold </li></ul><ul><li>More than two-thirds of laptops </li></ul>V1 (4/08)
  13. 13. Data: developing countries <ul><li>Asia </li></ul><ul><ul><li>Innovation away from the Internet </li></ul></ul><ul><li>Africa </li></ul><ul><ul><li>One mobile per child! </li></ul></ul><ul><li>Latin America </li></ul><ul><ul><li>Branchless banking and bankless banking </li></ul></ul>
  14. 14. Asia <ul><li>G-Cash and Smart in the Philippines </li></ul><ul><li>E-Tong in China </li></ul><ul><li>SKT Visa and KTF MasterCard in Korea </li></ul><ul><li>NETS and EZ-Link in Singapore </li></ul><ul><li>and others… </li></ul>V1 (4/08)
  15. 15. Africa <ul><li>M-PESA in Kenya as a case study </li></ul><ul><li>Cellpay, Wizzit and many more </li></ul>V1 (4/08)
  16. 16. Latin America <ul><li>Branchless banking and shared agent networks in Brazil </li></ul><ul><li>Cash, cards and cellular comparisons </li></ul>V1 (4/08)
  17. 17. What does the technology platform enable? <ul><li>Banking </li></ul><ul><ul><li>Social networks and personal payments </li></ul></ul><ul><li>Business </li></ul><ul><ul><li>De Bono and the IBM Dollar </li></ul></ul><ul><li>Community </li></ul><ul><ul><li>Regional differences </li></ul></ul>
  18. 18. Banking <ul><li>The relationship between banking and payments </li></ul><ul><li>Social networks and personal payments to reshape system </li></ul>V1 (4/08)
  19. 19. Business <ul><li>Private currencies: the Vodafone minute vs. the Zimbabwe $ </li></ul>V1 (4/08)
  20. 20. Community <ul><li>Babysitting vouchers, time dollars, LETS </li></ul><ul><li>Regional currencies </li></ul>V1 (4/08)
  21. 21. Winners and losers <ul><li>Winners </li></ul><ul><ul><li>The economy? E-commerce? Banks? </li></ul></ul><ul><li>Losers </li></ul><ul><ul><li>Criminals? Tax evaders? ATM manufacturers? </li></ul></ul>
  22. 22. Winners <ul><li>Economic growth </li></ul><ul><li>Reduced crime </li></ul><ul><ul><li>But if criminals can’t steal money, will they stop being criminals </li></ul></ul><ul><li>Reduced tax evasion </li></ul><ul><li>Banks </li></ul><ul><ul><li>No more cash handling, filling ATMs, armed robbery </li></ul></ul><ul><li>Poor people </li></ul><ul><ul><li>Who currently have the highest transaction charges </li></ul></ul>V1 (4/08)
  23. 23. Losers and the pound (not) in your pockets <ul><li>It costs the US mint 1.7 cents to make a penny </li></ul><ul><li>The note issuing department of the Bank of England is the most profitable nationalised industry ever </li></ul>V1 (4/08)
  24. 24. Thank you! <ul><li>David G.W. Birch </li></ul><ul><ul><li>[email_address] </li></ul></ul><ul><ul><li>www.dgwbirch.com </li></ul></ul><ul><li>Consult Hyperion </li></ul><ul><ul><li>www.chyp.com </li></ul></ul><ul><ul><li>And see www.chyp.com/podcasts </li></ul></ul><ul><li>Digital Money Forum blog </li></ul><ul><ul><li>www.digitalmoney forum.com/blog </li></ul></ul>

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