Professional Documents
Culture Documents
Zuo
In Edward Bellamys famous book Looking Backward: When Julian West woke
up in the year of 2000 after a 100-year sleep, he was told that there was no money in the
country. This didnt happen in 2000; however, 15 years later, people feel that we are
getting to he said world.
Starting from barter payment system, Human society has gone through different
phases; from commodity payment to currency payment and then cheque payment.
Commodity money, which usually has its own value, was used as a medium of exchange.
With its advantage of easier to standardize, store and carry than barter items, was widely
used in olden days. Currency money doesnt have an actual value in use, but is decreed to
have a value as a medium of exchange. Cheque is actually a bill of exchange that a
drawer gives a financial institution written order to make payment without drawers
carrying actual large amount of money type.
E-money
With the innovation and technologic development, e-money as a new-style terms of
payment, has replaced traditional payment to a large extent due to its convenient and
efficient features completely changed the world and peoples life style.
According to Bank of Canada:
E-money is a digital alternative to cash. It is monetary value that is stored and
transferred electronically through a variety of means - a mobile phone, tablet,
contactless card (or smart card), computer hard drive or servers.
Examples of e-money include prepaid payment cards that use payment
networks such as Visa or MasterCard, or account balances kept at online
service providers such as PayPal. Both can be used for a range of purchases in
different establishments. (Bank of Canada, 2014, E-money, Para. 3-5)
People use credit card for purchasing; bus pass for transportation; online transferring
to pay all bills. E-money exists everywhere in our daily life so it is actually becoming
Zuo
something we cant live without. The most notable of these is Sweden, with just 3% of its
economy in notes and coins, according to the Bank of International Settlements
(KNOWLEDGE@WHARTON , 2012, Going Cashless: Whats Good for Banks May Not
Be Best for You, Para. 15). CNBC
news of May 15, 2015 said that Denmark is getting closer to the world's first cashless
country that retailers should not accept cash by Jan 2016(Makortoff, K, 2015, This
country is trying to go cash-free). All these phenomenon raise the question of how far we
are from a real cashless world
The advantages of e-money
The advantages of e-money are obvious. For common people, E-money is easier and
safer to carry and store that people dont need to worry about being stolen or robbed; no
need to prepare small amount money for bus or parking; with the wide application of
mobile payment technology, a mobile phone can be used as a payment tool without
people bringing even an actual bank card; moreover, a more harmonious neighborhood
can be expected because there is no need to lock your door in a cashless world.
For the society, the crime rate is predicted to lower since bank robbery and highway
robbery will disappear. According to AFP news, one robber who tried to rob one of the
banks in Stockholm was disappointed because he didnt find any cash in the bank; illegal
activities such as drug dealing, illicit money and bribe, which are highly dependent on
cash, are expected to be greatly decreased tax evasion is not going to happen in a
cashless world.
The disadvantages of e-money
The disadvantages of e-money might not be noticeable right away. Some argues that
most national banks will lose a big portion of seigniorage income that is usually the main
source of operational expenses for national banks. The European Central Bank, used
Zuo
seigniorage earnings to survive during European debt crisis. In a cashless world, it would
be a challenge for national banks to seek for solutions to the said problems.
The people who live in developing countries might have the concern that the money
they have in bank might be wiped off completely one day from their bank accounts. In
some developing countries, the governments control all banks; therefore, there is
possibility that the governments use this as a political tool to strength its control and
power. North Korean who experienced a few currency reforms might prefer keeping
some real US dollars at home instead of keeping every penny in banks.
Technology and education are also the obstacles on the way to a cashless world. Not
everybody in the world is knowledgeable enough or has necessary equipment to access eaccounts.
Another important factor that should be taken into consideration is emotion. Some
people who are well-educated and live in modern cities bring cash to gain psychological
security; some people just simply like the feeling of counting notes; imagine where and
how husbands can hide pocket money in a world without cash? How can you reward your
children when they share your house works? The excitement of getting $1 in their
pockets right away is much stronger than add $1 in their bank accounts for kids.
Conclusion
In conclusion, a cashless world might be technically achievable in the near future;
however, cash can be a cute object that e-money cant replace. Just like e-news and ebooks, there still are some people insist that reading paper books and newspaper is a
wonderful experience.
To paraphrase General MacAuthurs word Cash never die. They just fade away.
Zuo
Work Cited
Bank of Canada. 2014. E-money. Retrieved June 10, 2015 from
www.cnbc.com/id/102682877
KNOWLEDGE@WHARTON. 2012. Going Cashless: Whats Good for Banks May Not
Be Best for You. Retrieved June 10, 2015 from
http://knowledge.wharton.upenn.edu/article/going-cashless-whats-good-for-banksmay-not-be-best-for-you/
Makortoff, K. 2015. This country is trying to go cash-free. Retrieved June 10, 2015 from
http://www.bankofcanada.ca/research/e-money/