Most of us will have our own experience of what it is like to be in a situation where you can neither access cash nor pay with it. Depending on where you are, and where that country is on its path to cashless payments and access to cash, you may find it easy, difficult, or well-nigh impossible to pay for much, if anything, with banknotes and coins.
From a purely personal perspective, this is my latest experience – written from the UK where the road to cashless is well-advanced, and where the government and Bank of England are taking steps to intervene to ensure that cash remains a payment option in the future. Thus far, the evidence of their efforts is mixed.
The experience relates to a vacation in Cornwall, a county on the south-western tip of the country which is sometimes referred to as the English Riviera, and which is heavily reliant on tourism.
There is the coffee stand at the entrance to the beach (cash only) and an ice cream van (ditto). The beach café is card only. The shop selling Cornish pasties and other local fare at the entrance to the beach road is also card only. You used to be able to get cashback there, but not any longer. The nearest supermarket, two miles away, takes both cash and cards, and has an ATM – but it is inside the shop, which is only open from 9-5, and charges for the privilege.
The nearest (and only) 24 hour free-to use ATM is another supermarket in the harbour town and resort of Padstow, four miles away. Padstow is a gourmet and yachting paradise, chock full of restaurants, bars and art galleries. None take cash.
The permanent population of Padstow and its surrounding parish is around 3,000. In a typical year, it receives an influx of 500,000 visitors plus seasonal workers. The last bank branch closed about five years ago, followed by the Post Office a couple of years later. There is a mobile banking service that visits for one morning a week, parked in a car park on the edge of the town up a very steep hill. The coin-operated ticket machines in the car park have all been removed, so the only way of paying is via an app.
The reason that none of the retailers in Padstow accept cash is that they cannot deposit it (I asked), unless they want to wait for the weekly mobile van or make a 40 km round trip to the larger town that does have banks. And because they don’t accept cash, cashback is not an option.
The area is fairly affluent, and most of the visitors will be more than happy and accustomed to paying with card. But internet access is spotty, and mobile coverage, particularly along the coast and on the beaches, non-existent (rendering payments by phone useless). Hence the need to pay with cash at facilities on or by the beach, which is all well and good if you come prepared. But if you don’t (and we didn’t), then those ice creams (and Cornwall is renowned for its ice cream) are tantalisingly out of reach.
In the great scheme of things, forgoing a cool hit of sugar is hardly of significance. But all these factors in ensuring a diverse payment environment are interconnected. And if one falls down, they all fall down.
The key factor is access to cash withdrawal facilities in the first place (be it an accessible ATM or a retailer offering cashback), which in turn relies on those outlets having access to cash deposit facilities. Take away the branches and the ATMs and that access disappears with it. A pay-to-use ATM in a shop that is closed when you need it, or a mobile bank that only visits once a week and is hard to reach anyway, doesn’t cut it.
Allied to that, if you have to rely on alternatives, then these in turn rely on good connectivity. The successful development of an increasingly cashless society (indeed, an increasingly digital society in all its forms) is dependent on good internet and mobile phone communications. If that doesn’t exist, then card and mobile payments don’t work. Which leaves cash, except that that doesn’t work either in Padstow or its surrounds.
There is evidence that in the UK and elsewhere that people are beginning to return to cash in order to help manage their budgets as the cost of living soars. In my recent experience, the inability to pay was the best means of all to manage my budget.