Thursday, Jun 21, 2018
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A cashless world is good for no one

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Visa says it’s “declaring war on cash.” It might as well say it’s declaring war on privacy, convenience, and certain vulnerable Americans.

The credit-card company wants to give 50 small American businesses — for now; the program may expand — as much as $10,000 apiece to go cashless. It’s also arguing that handling cash carries labor costs: Businesses must keep track of their cash and ferry it to banks.

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Of course, Visa has an interest in weaning the country off cash. It charges merchants fees for transactions on its network, and its network is one of the main alternatives to cash.

And the more people have Visa accounts, the more consumers may have to pay it fees and interest.

Paying with plastic, of course, has advantages. But so does paying cash. So long as businesses offer both options, customers can choose whichever suits them for a given transaction. But losing the cash option would have costs for all of us — and especially steep costs for some of us.

Cash provides privacy. When customers pay cash, it creates no record of their presence in the store or what they bought. Credit and debit cards inevitably do.

And cash is simpler for the customer. Cash customers, once they’ve checked their change, know they’ve paid what they intended to pay; the wrong amount is not going to disappear from their wallet without their noticing. Credit and debit customers have to keep their receipts and check their statements for erroneous or fraudulent transactions.

For some people, not being able to use cash would have even more disadvantages. Poor people’s neighborhoods may not have banks. Some people are paid in cash. And young people face restrictions on getting their own credit accounts. Overcoming these challenges can have costs in time and money, and those who can’t overcome them are excluded from businesses that only take plastic.

It might be nice for Visa if cash went away. That doesn’t mean it would be good for the rest of us.

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