While filing my tax the other week, I realised that I still had several years’ of old bank records and chequebook registers archived in my file cabinet. As I leafed through them, it struck me that I could accurately chart how my payment preferences have changed over the last 15 years in response to the widespread adoption of new payments technologies.
Back in 1996, for example, more than 80 per cent of my household spending was done using paper cheques. We had no electronic payment options other than the use of a credit card. As I reviewed my old records, I could see exactly when our local grocer introduced debit card payment stations; the number of cheques we wrote dropped by 8 per cent over that first year. When pay-at-the-pump kit was installed at our local petrol stations, our monthly cash withdrawals dropped by 30 per cent. I could trace when our mortgage company started accepting DFT payments online, when our bank introduced electronic bill pay services, and when PayPal finally went mainstream. The net effect on our household budget was also interesting to chart: our envelope and postage stamp use, for example, dropped by more than 93 per cent between 2000 and 2010.
Something else struck me: once the majority of our purchases were made electronically, I could reconstruct every transaction to within a second of it happening. I could also identify the exact geographical location where many of those purchases occurred. As a technologist, I found that intriguing. As a cyber-security researcher, I found it disquieting.
In our emerging era of ubiquitous surveillance, it’s almost impossible to conduct business without being tracked. Your car and mobile phone keep records of your movements throughout the day. Your bank card corroborates what you spent, and with whom, where, when, and for what. Amazon knows what you’ve read. Netflix knows what you’ve watched. Within a certain time window, CCTV systems can even capture what you were wearing. That realisation helped remind me that there will always be an irrefutable need to have a payment option that can’t be tracked or reconstructed. By which I mean cash.
Setting aside the perhaps pragmatic anxiety over constant state and corporate surveillance, there are clear reasons why you’d want a purchase to be covert: for me, that’s anniversary and birthday gifts. I’ve had many surprises ruined because my darling wife discovered an entry in our chequebook, or on the joint credit card statement, or even in her Amazon wish list where an item was suddenly marked as “bought”. That frustrates me no end, and it’s why I still use cash for some purchases so I can genuinely surprise (and, hopefully, delight) my wife.
To be clear, I’m very much in favour of a new digital currency standard. I just bought my first Oyster Card on my last trip to London, and I can’t wait for Near Field Communications payment tech to go mainstream. I’ll cheerfully adopt new payment types that makes my life faster, more efficient, and more secure. That being said, I am absolutely not giving up on cash. Pundits who evangelise that cash is dead are (to be charitable) overly optimistic. When it comes to those transactions that need to stay off the grid, I submit that cash is still the only practical solution.