CHOICE membership

Apparitions of a Cashless Society


#1

While the cashless society gets more hype every year, and the banks get ongoing get-out-of-jail-free cards for their malfeasance, reality is that our banks have very ordinary leadership right down to their IT systems where they seem to worry about every penny applied. But the markets and the pollies worship two things - profits and dividends, so customers become collateral damage.

Customers should be compensated for embarrassment, inconvenience for their inability to access their money, credit+penalty for every non-payment fee caused, and significant punitive damages to each affected customer, and an automatic statement on the credit reports that every late payment in the interval was on the bank. The following links span a few years, but. Such failures are not unique to Australia but anecdotally it it seems we have a higher incidence in recent years. Just a few instances…

https://au.news.yahoo.com/a/39728086/commbank-customers-left-fuming-after-outage-leaves-without-money/


Cash Only Businesses
Booking Fees
Shonky bakery
#2

And for those reasons, having been caught out more than once myself, I always have ‘a 50’ or so in my wallet. Of course that is hardly cashless. It’s not always a systemic failure - shops with terminals down/etc, network issues/fibre outages. Long gone are the days when you could insist on a vendor manually processing your credit card … then there are the more sinister potential implications of how such things could be used and exploited, by either side of the good/bad guy fence …


#3

Surprising or unsurprisingly, China’s government is pushing quickly towards a cashless economy. There are many advantages from a regulatory point of view…almost impossible for local tax avoidance, currency related crimes (drug dealing, fraud, counterfeiting etc) easy to identify and the list goes on.

One major disadvantage is every transaction can be monitored and with data being dollars, holistic economic data collection is posible unlike anything which has happened in the past.


#4

I carry some cash, and have cards from multiple unrelated issuers, but.


#5

That suggests ‘government 1, consumers 0’ when the outages are counted.


#6

… at least enough to buy a hamburger :wink:


#7

I remember the days when cards could be imprinted if the early generation efptos terminals failed. New cards have printed numbers rather than raised, stamped numbers making this option impossible.

But in the future, speaking to a neighbour high up in one of the banks, it is likely that payment will go from device to device using nfc…the retailer’s device confirms the transaction and then may have the ability to send all transactions in a bundle to the relevant financial institution at some time later (say that night when bank related traffic is low).

This would overcome the out of service issues…but could raise the overspending issue (overdraft) of the customer. I suspect that the customer’s device will keep tally of funds/credit remotely if connection to the bank is not available (possibly using technology like blockchain?)

There are always technological solutions to problems…but changes in technology seem to respond to problem rather than anticipate/be in front of them.


#8

I challenge that. Many technology solutions cause new problems as much as address old ones.

And for NFC devices, now everyone is required to own a smart phone or similar with NFC capability? Interesting mandate, that.

BTW, if the systems are down how does any payment get verified? The opportunity for fraud or just overspending and potentially without recourse seems huge.


#9

Both the Government and the banks would prefer it to be a cashless society as they both hate consumers having control over what they do with their money. Neither want cash payments or cash under the mattress because they both lose revenue.

These ‘minor glitches’ occuring on the transition to being cashless are considered a small price to pay; as it only causes them a small amount of short term bad PR.

Unfortunately, those ‘minor glitches’ can cause significant hardships for consumers. Not to mention the bigger long term issue of the loss of control over how we manage our money.


#10

Notwithstanding a number of reports indicate people are looser with ‘card money’ than actual currency. Many of us abstract ‘card money’ but personalise hard currency and are more careful stewards of what we do with it.


#11

A dollar in the hand is worth two in the bank???


#12

Many people would spend their $2 in the bank (shown by their balance on the app) without thinking, but would hold tightly onto that $1 in their pocket.


#13

Perhaps next time there is a review of mattresses, Choice needs to include the cash stuffed ones. (<-attempt at humour)


#14

It is starting to cost to access our own money. Recently terms & conditions have changed. We have two accounts - one receives our very modest income, if it does not increase by $200/month or has more than one withdrawal, we get no interest. Our Pensioner Account, used to pay interest at Deeming Rates, but this has changed to something like 0.5%pa (we get $0.03/qtr). We are allowed 9 free transactions per month - 4 EFTPOS & 5 BPAY. We changed from a Credit Card to a Debit Card to avoid the new $49pa Account Keeping Fee.
We use internet banking to pay our bills, and some of our providers now require or have incentivised direct debit. The fees are small - $2.50 withdrawal, $0.30 per BPay, $0.50 per EFTPoS, but they add up. For example, our Energy Provider bills us separately (4 different Tariffs, contracts) and direct debits monthly - 48 payments @ $0.30 = $14.40 for the privilege. Our “fees” bill is getting large. My husband, unfortunately, is incredibly loyal to this bank, so nothing will change.


#16

#17

It reminds me of the ATMs. When they were first introduced it was claimed that they were there to make it easier for customers. Now, we are often charged for NOT using the ATMs, being charged for having the audacity to actually go inside and take up one of the few remaining teller’s precious time.

It looks like it will be the same for the cashless society. It is being pushed as a convenience for users, but it will most likely be a long term cost. Or is that being cynical?


#18

Seems like the term ‘cynical’ might be retired within a generation in favour of the term ‘realist’ :wink:

Shareholders are the only concern. Customer convenience only when it comes to purse/wallet access - its just more convenient to get rid of your money! Banks and the government are in bed together when it comes to controlling funds flow end to end, as I think someone has mentioned … everything we are sold as convenience happens to be in complete harmony with their control …


#19

OK now I will say I am a ‘realist’. Sounds much better. :smirk:


#20

My wife was in a local store a few days ago, whose fancy touchscreen CBA device was ‘out of order’. She was unable to buy there, and was told by staff that very few people got cash from the nearby ATM and came back; they instead went to the Coles store 15 metres away.

So the shop was losing a day’s business because their banking device was ‘down’. I gather that this was a widespread outage, but the banks don’t promise 100% delivery - they rent the machine out to the merchant who then has to rely upon ‘thoughts and prayers’ to hope the technology doesn’t bankrupt them.

There are cashless networks that never fail, of course (unless the Internet does - and that means the end of society anyway). Cryptocurrencies like Bitcoin and Etherium rely upon the entire world to make sure the network remains up and transactions balance.

No - your current card can almost certainly do NFC transactions, where you simply hold the card near the terminal and the terminal reads the information it needs. Only one end of the NFC transaction needs all the smarts. Phones do NFC card emulation, meaning that you don’t actually need to carry the card with you, and that you can scan the loyalty card and all the coupons at the same time as you pay for your purchase.

I must admit that I bought a bunch of NFC tags a while ago, thinking that I could use them in various places to tell my phone what it should do (e.g. in the car: make sure Bluetooth is turned on, connect to car stereo, start playing Zenyatta Mondatta, turn screen off). I have an IFTTT rule that turns off WiFi when I leave my home, that is based upon Google Location Services, but if I used an NFC tag stuck on the door frame to do this, then I could stop Google from tracking every step I take. Of course, I have to date been too lazy to do any of the work necessary to get these things going, but they are incredibly cheap to buy so it’s not something I’m too worried by.


#21

Another day, another failure and another apology. It is not just our banks…