Topic: How long will it take banks to phase out physical cash completely? - page 8. (Read 4134 times)

Exactly. Cashless payment was indeed being encourage right now because of the pandemic, this was the countermeasure of our government to prevent the transmission of the disease. However, as soon as the vaccine is made and release in the market I believe that most of the people are getting back to what they are more accustomed. Perhaps the use of online paymetn method may continue in rich countries but I doubt that it will work on third world countries. Therefore, I think it will take several decades before the world become ready for these kind of paying method.

If the bank did, I'm sure it would be very fast. Especially with the support of the government as an official agency that can make everyone believe. Trust me, with just 2 years, banking can make digital money with a very large user and can be understood by 80% of people in the country.
We know that every leader in this nation has a branch to the smallest degree is a leader who arranges in units of 50 houses. And it is not difficult for the government and banking safely according to applicable health protocols

The fact that banks will be able to track and trace every single transaction performed with digital Fiat, gives me the "creeps". A CBDC powered by a government-owned Blockchain network, could undermine people's privacy as we speak. I believe that governments and central banks will accelerate the process of phasing out cash from mainstream use, in order to have greater control over people's money. While it's possible to surveil transactions on credit/debit card providers, it's not easy to do that with physical cash. That's why governments and central banks have become so interested in launching CBDCs of their own lately.

Of course, it'll be quite challenging to make everyone use the new digital version of Fiat. The elderly will not want to give up physical cash to a CBDC that easily. Only teens and young adults will. As long as this is the case, it might take a couple of decades from now before the world's economy becomes fully cashless. Once that happens, most people might adopt decentralized cryptocurrencies at a large scale as their privacy will be put at risk with a CBDC. Since CBDCs haven't materialized yet, all we can do is speculate what their outcome will be after launch. Just my thoughts

Aside from that, most people in the rural areas prefer the traditional fiat method. So I am not seeing in our lifetime that we will convert fully to digital cash. Maybe a large percentage of people will use digital cash in the years to come but I am not seeing that total phase out of fiat money. Maybe we will see the full conversion to digital cash in some progressive areas but not in rural to remote areas.

I can't be sure how long it will take to remove physical cash completely, and replace it with digital cash. Besides, I doubt we can
all switch to using digital cash totally, if you see that some people are not tech savvy. Especially for old people, they still choose
to use physical cash compared to digital cash. It could take several decades to be able to switch from physical cash to digital cash
perfectly.

It isn't a simple thing to be done overnight, first thing such a plan will make the country a step above other countries. For some reason there will be devaluation in the money, and if this is taken to the public opinion. It won't get support. Maybe a generation of technology dependent can initiate a change, and for sure it isn't gonna happen in the next fifty years.

Exactly the same national currency you're using now.  Just without the coins and notes.  Then they can monitor every single transaction, dictate where and when you can spend your money and freeze payments if they want to.

If they go cashless we should have all ready some idea what the curreny will be?? 

   Cryptoboss2020 I don't think we can talk in general about banks phasing out physical cash, every country is
different. While some countries are far from phasing out cash, some advanced countries are very close to that.
And it's what we will see first, advanced countries going cashless in near future. It's all about how developed
a country is.

they dont have a plan to kill cash yet ...as they are printing it more and more.
now they give out even more cash , btc will go away faster then fiat currency.
btc is not protected by any laws it doestnt belong to any goverment if one day the btc is just gone who blame for?? nobody !


i dont think the btc could be the cash money cant be so sacred btc is bad as money as gold.

gold is physical and not rational to use it as a money btc is slow and the creator is still unknown btc is still wild west.

Good point. CBDCs will bring increased adoption of cryptocurrencies in the mainstream world. It's like the "network effect" in my own opinion. Both crypto and Fiat might as well live alongside each other for the foreseeable future. People will find crypto more attractive than Fiat because of its decentralized and censorship-resistant nature. No matter how government's efforts may be, they'll be unable to stop people from using crypto in its entirety. How long it'll take to switch from physical to digital cash, will entirely depend on people themselves. I think it'll be decades before the world goes fully cashless. Banks won't be going anywhere, since they'll benefit the most with CBDCs. The new monetary system will be even better than the current one, as it'll give central banks and governments more power/control over the economy. They can track & trace every single transaction performed on the digital ledger. With physical cash being "phased out", people will resort to crypto for privacy/anonymity. After that, it'll be a never-ending battle as governments do everything in their power to try to stop people from using an alternative monetary system. But then, it'll be too late.

Nonetheless, I think there's no rush for banks to switch to CBDCs. After all, credit/debit cards, and in some cases, physical cash are being used in these times of turmoil. Research and development for the launch of a new monetary system, will take a long time in order to ensure everything works as intended. CBDCs will be gradually introduced alongside physical cash, until the latter stops being used by people worldwide. That's because old people still use physical cash for daily payments. Millennials will quickly adapt to cashless payments, paving the way for a cashless society in the future. Just my thoughts

Politicians do not really care, you need to understand that the bankers are their friends so even if seemingly out of nowhere they got really rich after being elected to an important position they can get away with that corruption, or at least that is the way it works on my country, the biggest hurdle in my opinion is the third point you raise, even if the cost of technology is going down and more people have access to the Internet at the same time there is still a great deal of people with no access to it and they will still need to use cash for the time being.

If you haven't looked into this topic, it may be the right time to read it

Well, at least read the part about how CBDCs may turn out beneficial for cryptocurrencies down the road. The utter irony is that the more the governments crack down on cash, with CBDCs or other tools, or all available means combined, the greater number of people will be using cryptocurrencies (Newton's third law applied to finance). And the mother of all ironies would be when crypto emerges as a single winner in the cash wars that central banks are going to unleash upon us

Phasing out physical cash is so impossible to be implemented. Even in more decades, I still believe that Physical Cash will stay in the world. Because a lot of people, especially the elderly doesn't know about digital transactions and other people in uncivilized places in the globe have no access to the internet, nor have the high technology powered gadgets. Physical Cash will remain as our traditional way of buying goods in daily living and other financial transactions, no matter how modernized the World is.

All the same, there are a number of difficulties that can not be simply ignored by saying that "just start accepting cashless payments".
This is a fairly long process that involves a lot of factors-as I said above, starting from the expansion of the infrastructure of payment systems and ending with old people with dollars under the sofa - as well as the fact that for some businesses, payment for cash and settlement service (annual) can be totally unprofitable because there is not such a number of payments that would have at least some logic. Any micro-business for the production of things-furniture, for example-some piece production and so on. There are many factors, and such a transition also needs to be coordinated with a lot of authorities, from the state authorities to the Federal government. Plus do not forget that in the US any attempt to force something can end in complete failure and downgrades so it's like stepping into a minefield except that.

But any merchant knows his figures

He knows that, say, 70% are paying in hard cash and the rest with plastic. Sound accounting says that a) he can't ask more from those who pay with cards, and b) he can't lower his margins lest he should get thrown out of business. This leaves him with only one avenue to follow that would let him escape this rip-off, and that is to socialize the card payment costs, then privatize the gains (if there are any)

In my country, the fee charged by Visa/Master is 1.8% plus GST, which comes to 2%. So if you sell something worth $1,000, then you need to pay Visa $20. In a way, what you are saying is correct. This $20 should be added to the "price of goods and services". In such cases, the profit margin for the merchant is $30, or 3%. Now the complexity comes in, because the merchant accept several modes of payment. He accepts physical cash, he accept payment from mobile wallets and he also accept Visa/Master. So here, the "price of goods and services" is not a uniform figure. It can range from $950 to $970.

Although the economy can recover in terms of foreign aid, the epidemic cannot be controlled. The epidemic cannot be eradicated at once unless adequate vaccines are available. The number of epidemics is increasing day by day. But it will take a long time for the banks to cash in. Banks are not able to function properly due to the epidemic and they are not able to function properly due to lack of proper action by the government which is reducing the demand of their banks.

Agree. CBDCs will just become "Fiat on steroids". It'll be nothing more than a centralized "glorified" digital ledger where banks and governments can manipulate the economy at will. The end user won't notice the difference when using CBDCs, except for issuers themselves. I believe that governments are eager to distribute CBDCs in the least time possible in order to have greater control over the economy. After all, physical cash transactions become harder to track and trace by said entities. A CBDC will eliminate privacy once and for all, increasing government surveillance as we speak. Decentralized cryptocurrencies like Bitcoin and Ethereum will become an "escape route" for those looking for privacy and censorship resistance. It'll be a never-ending battle between the centralized and decentralized economy in the future.

Even now with physical cash in play, governments have been trying to do their best in order to prevent the masses from using crypto on top of Fiat. Things will become even worse with CBDCs as they give governments and central banks more power over the mainstream economy. Imagine if they declare crypto to be "illegal". Most people would think twice before using crypto for daily payments. Only a very small minority will be using crypto "behind the scenes" as an alternative to digital Fiat (CBDC). For now, CBDCs are purely experimental. It may take a couple of years from now, before they're fully tested and developed into a large ecosystem people can use for mainstream transactions. Once physical cash is phased out at a slow and steady pace, CBDCs will completely take over the world's economy in the future. Just my thoughts

I'm not sure your calculations are correct

Note that I don't necessarily say they are wrong. I just don't understand how you arrived at 20% to 40% of profit margin being eaten up by the payment system. To make life easier and calculations simpler, let's consider the charge at 1% exactly. So how did you get 20% out of a 5% profit margin? Like 5% of profit out of 1000$ transacted amount is 50$, and you pay 1% which is 10$, or 20% taken from 50$ of profits, right? To me, it doesn't look like a correct approach to calculating costs

As I see it, if you should include the costs of using Visa or MasterCard in the price of goods and services you offer as they are just costs like any other, regardless of the actual payment method your clients might use. Then your profit margins should remain more or less intact. In other words, you will have to close the shop if you are going to pay so much out of your profits provided everyone pays with Visa or MasterCard, of course. What am I missing here?