Why are we still paying for stuff with pieces of plastic?

Cash is king, the old saying goes. Well, it’s time that particular monarch was overthrown. How is it that in 2016, when we carry the internet in our pockets, we still conduct transactions by exchanging brightly-coloured pieces of plastic with numbers written on them? And how is carrying a jangling bunch of metal coins around in any way efficient?

Coins and notes were useful instruments in their day, but that day is over. Increasing numbers of us no longer carry notepads and pencils wherever we go, or look at the mechanical hands of a wristwatch when we want to know the time, and it’s time for the practice of carrying cash to follow these devices into the dustbin of history.

But it’s coins that irritate me most. They’re heavy and bulky, and they accumulate so quickly. Retailers are still playing those silly games where things cost $4.95 instead of $5, so we’re constantly getting pointless 5 cent pieces. After an average day, my pockets are full of those bulky 20c and 50c coins. I’ve got a jar at home that I lug to the bank a couple of times per year – the whole thing is just annoying.

Admittedly, I’ve never been good with cash. For some reason, I’m incapable of getting more out of the ATM before I’ve exhausted my current supply. And I’m so irritated by ATM fees that I’ll often do without a refresh until I happen to pass one of my bank’s machines. For days on end, I’ll try to get by via tapping my credit card for sub-$100 transactions. Which is getting easier and easier – I often go four or five days without a cent on me. So any muggers are likely to be very disappointed.

Australians have been some of the world’s most enthusiastic adopters of tap-and-go credit cards. Our banks are putting Paypass and PayWave machines everywhere, and it’s increasingly possible to pay for everyday transactions without them. Not only is tap-and-go incredibly convenient, but everything’s already logged for accounting purposes. Sure, that means that big multinational credit card providers get to clip every ticket, but it will ultimately mean that taxpayers have to spend less money minting banknotes and coins.

The founder of Pablo and Rusty’s café, Saxon Wright, is opening a cashless café in Brisbane where people will be able to pay with tap card or cups with embedded chips in them. As Wright points out, it’s hard to imagine why small businesses would want to handle cash instead of dealing with tap-based payments unless they’re paying their staff cash in hand. Doing without cash frees up time spent on accounting and visiting the branch to bank your takings. And you can already go cashless in many cafés, in fact – not just because they support tap and go, but many places let you order via a phone app like Hey You instead of paying up front.

Cash dates back to Venice, apparently, where instead of exchanging actual bars of silver, merchants instead swapped pieces of paper instructing their bankers to make payment on demand. As time went by, it seemed easier to simply swap these promissory notes than having to bother with the actual silver bars.

That quaint tradition lives on today in a visible form in Hong Kong, where banknotes are issued by three different banks, each of which says something like “HSBC promises to pay the bearer at its office here”. I’ve never been able to understand in which form the bank would pay a bearer, since you’re already holding a banknote, but then again, I don’t get why you’d have three different types of $100 note, either.

But Hong Kong is leading the world in getting rid of cash, too. The Octopus system, originally invented as a public transport smartcard like our own Opal and Myki, now permeates many aspects of life in the city. Every convenience store lets you pay via Octopus, every vending machine does too, and you can even use it in McDonald’s. Jointcredit/Octopus cards are available from all major banks, and they automatically refill out of your account. Increasingly, there’s no need for Hongkongers to carry cash at all.

The HK authorities also sell Octopus SIM cards for phones, which allow users to simply tap their phones to catch public transport or perform common cash transactions. Apple, Samsung and others have also developed systems that let us tap our phones to pay, and this will allow a limit higher than the Paypass/PayWave $100. Before long, we won’t even need to carry credit cards for many transactions.

Personally, I can’t wait until I only need to carry my phone and keys, and no cash or cards whatsoever. My wallet currently contains just shy of 20 different cards, very few of which I ever need. I don’t even need my Medicare card when I go to my GP nowadays. Why can’t my phone just contain a scan of it, or something?

But it’s cash that needs to go first. Experts say that except on those rare occasions when computers are down, the only people who really need to use banknotes in this era of electronic transfers are tax evaders and criminals. Think about the last time you had a $100 note. ATMs don’t issue them, and I reckon I haven’t had one in my wallet since I last took out money over the counter three years ago.

And yet the RBA says that there are 300 million $100 notes in circulation – about a dozen per citizen. No wonder experts have suggested getting rid of the higher-denomination bills as a means of choking funds for organised crime and terrorism.

I never want to have to go hunting for an ATM again, because cash, the king, is dead, or nearly as good as. Long live our new tapping-based overlords, I say. And if anyone’s planning to mug me, it’s all good – I’ll just take out my phone and transfer you a few bucks.

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