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What U.S. Businesses Can Learn from Countries that Have Gone Cashless and Failed

It's fascinating to see how different countries are approaching the move towards a cashless society, or not taking any steps at all to go cashless. The European Central Bank “says cash was used for 59% of point-of-sale transactions in 2022 and is the most-used payment method for in-store and person-to-person transactions.”

Sweden is often cited as the leading example of a cashless country, with only 13% of its population using cash on a regular basis. However, for some consumers not being able to pay in cash is an issue. Case in point, in Switzerland, the Swiss Freedom Movement (FBS) recently announced it had collected enough signatures to trigger a national vote on preserving cash for posterity. If passed, the initiative would require the federal government to ensure that coins and banknotes are always available in sufficient quantities.

But there are other countries, such as India, that have tried and failed to go cashless and others like Sweden that have chosen to stay with a mix of electronic payments and cash. So, what’s the best solution?


Proponents of a cashless society argue that electronic payments are more efficient, safer and more transparent than using cash. Electronic payments can be processed faster and more accurately, reducing the potential for errors and delays. They also reduce the risk of theft and counterfeiting and can also be tracked and monitored, making it easier to identify fraudulent transactions.


Privacy Concerns - On the other hand, tracking and monitoring transactions is the number one reason cited as why consumers don’t want to move towards a cashless society. Privacy concerns are raised as every financial transaction can be tracked, recorded and potentially shared with third parties without consent. This raises concerns about privacy violations, government surveillance, cyber-attacks and data breaches.

Reliable Infrastructure - In addition to privacy concerns, a cashless society requires a reliable digital infrastructure, high-speed internet and widespread access to digital devices. The absence of these technologies in certain regions or among certain populations may worsen economic differences and limit financial inclusion. India’s push towards a cashless society was hampered by technical glitches and power outages in the digital payment systems.

US Legislatures Aren’t on Board

U.S. state legislatures have expressed concerns about the move towards a cashless society and have taken steps to prevent businesses from refusing to accept cash payments. In 2020 New York city passed legislation making it illegal for retailers to not accept cash for in-person sales, joining other big cities and state like Philadelphia, San Francisco and Washington, DC

The reasoning behind these laws is similar to the concerns that have been raised in other countries, such as financial exclusion. Cash payments are widely used in the US, particularly among low-income households, elderly people, and those without access to digital payment methods.

Per the FDIC, “An estimated 4.5 percent of U.S. households (approximately 5.9 million) were “unbanked” in 2021, meaning that no one in the household had a checking or savings account at a bank or credit union.” By requiring businesses to accept cash, these laws aim to ensure that everyone has access to goods and services, regardless of their financial situation or access to technology.

There are also concerns around privacy and surveillance, with some legislators worried that a move towards a cashless society could give banks and other financial institutions too much control over people's finances. According to the International Monetary Fund, in a cashless society the general public won’t have access to “a state-guaranteed means of payment and the private sector will to a greater extent control accessibility, technological developments, and pricing of the available payment methods.” By requiring businesses to accept cash, these laws aim to protect people's right to privacy and financial autonomy.

So, What Can US Businesses Learn?

The Swedish government has worked to create a balanced payment infrastructure that includes both cash and digital payment methods, to ensure that everyone has access to the payment options that best suit their needs.

A mixed payment system can offer many benefits. It ensures no one is excluded from participating in the economy due to a lack of access to a particular payment method. It also allows consumers to choose the payment method that best suits their needs and preferences. Finally, a mixed payment system can help to prevent any one payment method from dominating the market, which helps to ensure healthy competition and innovation.

Ensure your customers have easy access to cash.

Reach out to us about having a hassle-free ATM installed in your business.

Give us a call at (800) 849-3029 or email us today!


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