Cashless proponents have sounded the death bell for cash for at least two decades, but their predictions have been premature. To be sure, digital forms of payment have received a boost in recent years but have not succeeded in completely displacing coins and paper money. Its unlikely cash will be replaced anytime soon – if ever.
The need for legal tender remains high in a variety of settings, including small retail shops, convenience stores and environments where tipping is common. Cash has proven resilient despite threats over the years from a variety of alternatives, including credit and debit cards, online payment systems and digital wallets.
High volumes of coins and bills remain in circulation around the world. In the United States, cash circulation is higher than ever. The U.S. is hardly alone, according to banking services organization BIS, which says most countries have seen higher cash in circulation since 2000. BIS, which works with 60 central banks, says “demand for cash rose in most advanced economies after the 2008 global financial crisis.”
It still means something to have cash in your pocket. In fact, most small retailers prefer it that way. “Cash is king. When you pay with cash, businesses know that the transaction is complete, and there’s minimal risk of future complications,” a recent article in The Balance explained.