Cash is unlikely to go away soon. Coins and paper currency remain the most popular ways to pay for things in most countries. But longer term, cash appears to be in a losing battle with electronic payment methods.
Share of adults who made or received any noncash payment
Data not available
0
40
65
90
95
100%
Data not available
0
40
65
90
95
100%
97%
Canada
99%
Sweden
72%
Mongolia
58%
Russia
97%
Britain
89%
Japan
49%
China
92%
United States
88%
South Korea
22%
India
35%
Mexico
87%
Iran
69%
Kenya
59%
Brazil
97%
Australia
66%
South Africa
0
40
65
90
95
100%
Data not available
97%
Canada
99%
Sweden
72%
Mongolia
58%
Russia
97%
Britain
89%
Japan
49%
China
92%
United States
88%
South Korea
22%
India
35%
Mexico
87%
Iran
69%
Kenya
59%
Brazil
97%
Australia
66%
South Africa
55%
Chile
0
40
65
90
95
100%
Data not available
There are few corners of the world where electronic transactions are not growing faster than cash. The consulting firm Capgemini recently estimated that electronic payments will grow about 10.9 percent a year between 2015 and 2020.
But the movement away from cash is happening in very different ways and at varying paces around the world.
Scandinavian countries are already well along the road toward cashless societies. Many banks in Sweden no longer have cash on hand, and consumers can make instant transfers directly from their bank accounts.
In Kenya, the local mobile phone company Safaricom, not the banks or the government, has pushed the envelope. Safaricom created a system, known as M-Pesa, that allows customers to make payments directly from their phones.
China is the most talked-about location in the battle between cash and electronic payments. PayPal-like wallets created by Chinese online giants Alibaba and Tencent have become the most popular ways to pay for things online.
Debit card payments |
|
|---|---|
Norway |
96% |
Netherlands |
94 |
Sweden |
93 |
New Zealand |
92 |
Britain |
92 |
Credit card payments |
|
|---|---|
Israel |
75% |
Canada |
73 |
Luxembourg |
63 |
Hong Kong |
59 |
New Zealand |
58 |
Mobile phone payments |
|
|---|---|
Kenya |
55% |
Uganda |
35 |
Sweden |
34 |
Australia |
33 |
South Korea |
33 |
The benefits of moving away from cash have been trumpeted by economists like Kenneth Rogoff, who wrote “The Curse of Cash,” about how paper money enables crime and tax evasion.
But the critics of cash have been met by their own critics, who argue that electronic payments can disenfranchise poor people who lack easy access to bank accounts and the internet and can make it much easier for governments and corporations to monitor a person’s every step.
In the end, though, the future of money is less likely to be determined by these arguments than to be shaped by the success of technologists making it easier for you to pay for your lunch or morning coffee without pulling out your wallet.
SWEDEN
99% of adults have made a digital payment
Share of adults who made a payment with:
A debit card
93
%
A credit card
36
%
A mobile phone
34
%
50
Sweden has been one of most visible leaders in the war on cash. In recent years, the biggest innovation has been not in bank cards but in a phone app known as Swish, which enables instant bank transfers.
GERMANY
96% of adults have made a digital payment
Share of adults who made a payment with:
A debit card
79
%
A credit card
36
%
A mobile phone
13
%
50
Germany has been slower than other European countries to move away from cash. Germans have a preference for debit cards over credit cards because of a cultural dislike of debt. (Not coincidentally, the German word for debt, schuld, also means guilt).
UNITED STATES
92% of adults have made a digital payment
Share of adults who made a payment with:
A debit card
67
%
A credit card
57
%
A mobile phone
32
%
50
The United States has lagged behind many wealthy countries in moving away from cash. American banks have been slow to make instant bank transfers possible — most still take at least day. Debit and credit cards remain the most popular payment methods.
JAPAN
89% of adults have made a digital payment
Share of adults who made a payment with:
A debit card
39
%
A credit card
52
%
A mobile phone
6
%
50
Payment cards have become popular in Japan, but it has been slower to give up cash than most other rich countries. The government has initiatives to speed up the transition but consumers have been hesitant to leave cash behind.
SOUTH KOREA
88% of adults have made a digital payment
Share of adults who made a payment with:
A debit card
56
%
A credit card
54
%
A mobile phone
33
%
50
As part of its war on corruption, South Korea has pushed hard to move its financial system away from cash. Companies refusing to take electronic payments have been penalized, and the South Korea central bank has called for a “cashless society” by 2020.
KENYA
69% of adults have made a digital payment
Share of adults who made a payment with:
A debit card
11
%
A credit card
3
%
A mobile phone
55
%
50
Kenya is a model for how electronic payments can evolve without banks. M-Pesa, introduced in 2007 by the largest Kenyan mobile phone provider, Safaricom, allows people without bank accounts to send money electronically. Most Kenyans are using the service.
CHINA
49% of adults have made a digital payment
Share of adults who made a payment with:
A debit card
17
%
A credit card
14
%
A mobile phone
14
%
50
In the last few years China has led the charge into the cashless future. Internet giants like Alibaba and Tencent have created their own online payment methods. Alipay and Tenpay have rapidly become the most popular ways to pay.
INDIA
22% of adults have made a digital payment
Share of adults who made a payment with:
A debit card
11
%
A credit card
3
%
A mobile phone
5
%
50
India has been slow to move away from cash. But last year it took the largest cash bills out of circulation as part of an anti-corruption campaign. Companies like Facebook and Alipay hope the move will provide an opening for electronic payment systems.