Going cashless: the buck stops here

Together, Australians carry a total of $1 trillion (AUD) in debt, the equivalent of $56,000 (US) for every Australian adult. The average American adult has about $45,000 (US) worth of debt.

In the UK, the recently installed Archbishop of Canterbury, Justin Welby pledged to weaken the stranglehold of payday loan companies in the emerging debt economy. He announced his intention to put the less ethical groups out of business, by developing alternative lending schemes based on the local cooperative model.

The fact that this was one of the first social issues he addressed, when there are currently so many alternatives, reflects how pressing a problem it has become.

Another challenge with going cashless involves the loss of funds stored on railway and other RFID cards, which are not in the end used by the consumer.

Public Transport Victoria, which oversees Melbourne's metro train service, admits that its latest profit figures reflect an underuse of its myki smartcards - its version of London's Oyster system. It says that customers often put funds into more than one card and never fully utilise them. One is left to wonder howmany millions of pounds are squandered in this way in the world's mega cities.

There is no place for a reactionary Luddite approach when it comes to our growing reliance on digital tools. At the same time, though, there's little value in heedlessly buying into the hype about 'going cashless'.

Cash may not seem as sexy as the money we shift about on our shiny smart-gadgets, but it carries no personal information. 

According to the Australian Bureau of Statistics Personal Fraud Survey 2010-11, Australians lost $1.4 billion due to personal fraud in that period.

The survey estimated that 1.2 million Australians aged 15 years and fell victim to at least one incident of identity fraud in the 12 months prior to the survey. This represents a five percent increase on victims since 2007.

There are implications in the issue of cashless spending for more than our bank balances.

What will the shift from physical money to the digital variety mean for human cognitive functions? We teach young children to count not with abstract arithmetical symbols, but by using physical objects such as pieces of fruit. 

In doing so, we allow them to associate numbers with substantial objects, showing them that numerical icons have meaning in the physical world. What use will most of us have for our few basic mental arithmetic skills when the physicality of cash is totally replaced by binary code?