Cash and Digital Payments: Why We Need Both

Fortunately, this topic doesn't require me some research or imagination. At least, not for someone who has experienced a similar scenario already in their part of the world. So I don't think I need to imagine it or try to put some research together and all that to know what the outcome would be like. I consider that we've had a snippet of this already in my country some years back, and it won't look different even today.

Some years back, we had a lack of cash flow. Something we've come to know popularly as the cash scarcity period. As the name suggests, there was a gross scarcity of cash currency in circulation among the masses. What's problematic was that goods sellers and service providers like drivers required it mainly for payment. What led to that was the government seeking to redesign the old notes, making them obsolete, hence cutting off supply.

People were sceptical about accepting old notes. So even those in circulation were rejected. It became more of an issue that it was because there was little to no circulation of the new cash notes. People had to turn to digital payments and transactions. But as mentioned, goods sellers and providers of services still required payments in cash, and the cash was nowhere to be found. All of that made things uneasy. People had difficulty with monetary transactions.

I look at the events of that time and the state of things and development in my country currently and I know we're not yet ready to get rid of cash. I'm not against digitalisation of monetary transactions. I mean, there's an ease that comes with it. Personally, I don't really find it easy, comfortable, or convenient to keep much cash on me. So, keeping money and doing transactions digitally seems like a favourable and appealing option to me.

However, I've also seen the difficulty with this in my part of the world which is why we're not yet ready to make cash go obsolete. I know the world is moving towards cashless transactions and an economy, with cryptocurrency taking the stage at some point. But this will function in advanced systems. Here, we're not yet there. There's a level of digital illiteracy that makes it hard for it to flow at this point, which still doesn't stop economic activities.

Do we then ignore such people? Funny enough, they're some of the major producers of the goods we consume, especially agricultural products. Some don't even have a bank account, because they don't understand how it works or as funny as it sounds, they don't believe in a bank keeping their money. Even when they do, some feel they could be cheated through transactions since they're not learned in that respect. All of that makes some valid points.

What about the issue of bad network constantly experienced and network not available in rural places? We're not yet ready. Rather than getting rid of cash, let there be a coexistence of both as we have it now. Many are adapting to the digital system. As time goes by, and the advent of new generations who are more and more digitally literate, this can be possible. Of course, if the government play its part as well in development and upgrading its systems.

Image is AI generated.

Thank you for reading!