Cash and Credit Cards Will Be (Nearly) Dead Within the Next 8 Years
Your wallet may soon be a collector's item. In a report published this morning, Pew surveyed a selection of academics, authors, and other experts, asking them questions about the future of money. Their conclusion: The future of money is digital. And that future might not be, actually, entirely about money.
The survey asked its participants -- more than 1,000 of them -- to agree or disagree with the following statement:
By 2020, most people will have embraced and fully adopted the use of smart-device swiping for purchases they make, nearly eliminating the need for cash or credit cards. People will come to trust and rely on personal hardware and software for handling monetary transactions over the Internet and in stores. Cash and credit cards will have mostly disappeared from many of the transactions that occur in advanced countries.
Given the explosion of mobile transactions over the past several years, it's hard to disagree with that proposition, and with the general idea that cash and credit cards are, effectively, on their way out. Which is probably why, in the end, 65 percent of the experts agreed to the statement. And only 33 percent percent agreed with the converse proposition that, mostly due to consumer privacy concerns, cash and credit cards would remain the norm.
That finding doesn't just mean bad news for the coin-minters and wallet-makers of the world. It could also mean new possibilities when it comes to financial transactions themselves. A cashless (or, more realistically, a nearly cashless) default of economic exchange could encourage, among us walletless wanderers, a broader conception of what "exchange" means in the first place. Because cash -- and, really, money itself -- is not merely a vehicle of financial transaction; it is also a cross-cultural paradigm. It has shaped the way we think about exchange as a basic economic proposition: not X for Y, but X for $Y. (Or, you know, for ¥Y or £Y or €Y.)
Money, in other words, has conditioned us to believe that money is pretty much the only legitimate medium of transaction. Through its durability -- and, especially, through its universality -- the currency paradigm has made it easy to forget what a cultural contingency currency actually is. There are, after all, many other forms of exchange out there, many sophisticated forms of barter and quid pro quo; it's just that money -- cash and currency -- has been, for ages, the superior facilitator of those forms. We live in currency-normative culture, if you will, for a reason: Money, as a technology, has acquitted itself wonderfully. It's efficient, it's intuitive, it's relatively user-friendly. And, most importantly, it's standardized.
But money will become, Pew is suggesting, just a little less standardized. In a world of increasingly cashless commerce -- a world that is also taking tentative steps toward normalizing experimental currencies and modes of exchange -- we have less reason than we did before to assume that, when it comes to purchasing things, it's money or nothing. A deviation from the currency paradigm could be incredibly liberating for people on both ends of economic exchange, because an ecosystem in which cash is no longer the norm might also be an ecosystem that is freer to experiment with other forms of transaction: barter, the exchange of services for goods, the exchange of publicity for services, etc. "Not only will our notion of currency change as it becomes electronic and (even more) virtual," author Jeff Jarvis writes in the Pew survey, "but I see the possibility for new currencies measuring new value." So: A Yelp review of a restaurant might get you a free meal. Contributing to a news report, citizen-journalism-style, might yield a month of subscription to a given publication. You might buy things not with money, but with your voice and your attention and your time.
There are limitations to barter-based exchanges, of course, and it's hard to see a future where they fully displace -- or even come close to fully displacing -- actually currency. Money will likely remain the norm; the point, though, is that it won't necessarily remain the default. And that could create a vacuum that will make room for other mediums of exchange. Experimental transactions become much easier to imagine in a world in which each individual consumer suddenly has a public face. People suddenly have a power that extends beyond their pocketbooks. And that will mean that the tools available to them to obtain goods and services may -- and, likely, will -- extend beyond standardized currency. The Pew findings are a reminder that, as a technology, money may be ripe for disruption.