Those of us of a certain age can remember when cash was king. Back in the day, few had credit cards, “tap” purchases were decades away in the future, and – minus a mobile phone, which was still being invented – you needed change to make a phone call when away from your landline.

Bills were paid by cheque, or directly at your bank branch, where there was a massive lineup out to the street on pay day.

The pandemic seems to have speeded up an already “in progress” move away from cash. Save with SPP took a look around to see what people are making of this development.

Writing in the Globe and Mail, Casey Plett notes that the idea that we are becoming “a cashless society” has turned into “a common belief… as if currency were simply one of so many Old World analog relics circling the drain before they gurgle into oblivion.”

Her article notes that during the early days of COVID-19, the use of cash “was phased out entirely” by many institutions over fears that money might actually help the pandemic spread more quickly. Even though such concerns have now been addressed, the use of cash has not resumed at pre-COVID levels, she notes.

“But a cashless society is not a foregone conclusion,” Plett writes in the Globe. “And while it may seem like a fuddy-duddy Luddite concern – the equivalent of clinging to one’s touch-tone phone, perhaps, or making a plea for beepers – a complete societal changeover to non-cash payment would not, in fact, be a good thing.”

She says a fully cashless society would be “inequitable” for those – such as the vulnerable and the homeless – who don’t have access to the banking system. Her article cites figures from the Canadian Centre for Policy Alternatives showing that an astounding one million Canadians (as of 2016) were “bankless,” and five million more “underbanked.” This latter group may have a bank account, but no credit or other banking services.

She also points out that cash can be indispensable when the Internet goes out, your credit card is locked for mysterious reasons, or if there’s a power outage (remember 2003). Cash, she writes, “is a refuge of privacy,” in that your purchases with it aren’t tracked or marketed. She concludes by saying it would be unwise for governments to move away from it altogether.

Even before the pandemic was an idea, the National Post was predicting the end of cash would arrive five years ago in 2016.

The Post cited research from 2016 showing that 77 per cent of respondents “preferred to pay for purchases by debit or credit card,” and that 65 per cent said “they rarely buy anything with cash anymore.”

In that article, Rob Cameron of Moneris is quoted as saying ““I do think people will continue to use cash because it’s been around so long…. But this growth in contactless (payments using credit cards or mobile apps) I think is going to lead towards that end of cash.”

Figures from the Bank of Canada show that there is a trend away from cash. As recently as 2009, the bank reports, 54 per cent of transactions were made using cash. By 2013 that number dipped to 42 per cent and by 2017, 33 per cent.

“So, does this mean that Canadians are giving up on cash?,” asks the Bank of Canada. “The short answer is no. Canadians still rate cash as easy to use, low in cost, secure and nearly universally accepted, and it’s the preferred payment option for small-value purchases like a cup of coffee or a muffin.”

Well, maybe. Last word on the topic goes to economist Eswar Prasad, who tells CNBC that “the combination of cryptocurrency, stablecoins, central bank digital currencies (CBDCs) and other digital payment systems will lead to the demise of [physical] cash.”

The takeaway here is that all of us need to try and stay current with new trends. Cash is being joined by many other ways to pay. Even when we were out distributing poppies for the Legion in October we found that many people did not have any cash, or had to run to their cars and dig around for change. So, the Legion has begun to roll out “tap” poppy boxes.

Personally, we think cash will never entirely fade away. Think of big trends in music – punk, disco, progressive rock. Sure, you don’t see chart-topping music in those categories any more, but it is still being played, and in some corners of the globe, being developed.

No matter how you choose to spend it, you will appreciate having some form of currency when you retire. If you are saving on your own for retirement, consider the help of the Saskatchewan Pension Plan. The plan offers an end-to-end pension service; and once you are a member, you can contribute to your savings by cheque, through online bill payment, with automatic deposits, or even with a credit card. Be sure to check out SPP today!

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