Mark Wilson | Getty Images News | Getty Images
A printing supervisor inspects newly printed sheets of $1 bills at the Bureau of Engraving and Printing in Washington, D.C.
The cashless society myth: PayPal, Square, and bitcoin have not stopped cash from being a growth business
US. cash in circulation has grown at a 5 percent-plus rate for the past two decades, with the number of notes in circulation doubling to 40 billion between 1996 and 2016.
Cash remains the most frequent method of payment in the U.S., representing roughly 31 percent of consumer transactions, more than electronic, credit, debit or checks.
Even with internet sales led by Amazon growing quickly, e-commerce represents less than 10 percent of all retail transactions.
Use of cash by U.S. households is consistent across most income levels, around 25 percent, and goes way up at the lowest incomes.
If you listen to the way mobile payments executives talk about cash, the only thing as certain as its death is their reluctance to be the ones accountable for putting that event on any kind of timetable.
“I would never predict the death of cash over the next decade or two. I think cash is going to be with us for a long time to come,” PayPal CEO Dan Schulman recently told the New York Times.
“It’s still decades and decades and decades. It’s going to take our lifetime and our kids’ lifetime before you start to see this work itself out,” said Michael Vaughan, chief operating officer at millennial-friendly Venmo — which is owned by PayPal — when he spoke at a Wharton conference earlier this year.
Danny Meyer is standing behind his belief in cashless restaurants, even though one of the most prominent restaurant chains he founded, Shake Shack, stumbled out of the starting gate when it tried to put that theory into practice as an experiment in a few of its burger joints.
With the rapid disruptions caused by successful Silicon Valley-based mobile payment companies like PayPal and Square, and technology giants Google and Apple making greater efforts to handle purchase transactions through smartphones, it is easy to expect the dollar’s obit to appear any day now. But even Amazon, with an increasing hold over consumer spending in an e-commerce environment, and internet transactions growing at an annual rate above 15 percent, it represents a sector with less than 10 percent of all retail transactions. And data from the Federal Reserve Bank of St. Louis shows that U.S. currency in circulation, over $1.6 trillion currently, continues to go in only one direction: up.
Published 9:32 AM ET Mon, 6 Aug 2018
YOU MAY ALSO LIKE
Visa Invests in Behalf to Support Small Business Financing
August 07, 2018 03:00 AM Eastern Daylight Time
Why American credit card companies can’t break into China
August 3, 2018: 10:21 AM ET