Consumer card payments surpassed cash payments in the previous year for the first time, registering 23.1 trillion US dollars globally. This fact is an indication that people are starting to use their cards more often to make their transactions and the use of cash in a few years will be just a memory.
A survey made by Euromonitor International, one of the leading companies in global market research, showed that consumers are turning more and more to electronic payments and e-commerce. The survey shows that card payments and mobile commerce will see a 6.6% and 23% increase respectively in their compound annual growth rate (CAGR) in the period 2017-2021. Global cash payments are predicted to register a poor 1.3% CAGR increase, which signals the will of people to use more the modern ways that technology offers.
Kendrick Sands, a senior analyst of Euromonitor International, commented that “a decrease of cash supply in the next years will be a great victory for cards and e-payments. A continued strong momentum is expected in the conversion of consumer payments away from paper to card and electronic alternatives”. Cap Gemini, a French information technology consulting company, suggests in one of its reports, that the fastest growing regions in matters of card transactions are emerging Asia, the countries of Central Europe, the Middle East and Africa.
In China, 5.4 billion cards are in circulation. 65% of them are debit cards. On a global level the debit card number increases much faster than that of credit cards. Dan Frechtling, senior Vice President of Marketing at G2webservices, commented that “moving away from cash and checks are signs of modernizing economies, showing more efficiency and less fraud. Unfortunately, in some cases card use is good news for criminal activity. Cash based money laundering is replaced by transaction laundering that can move funds electronically with a good chance of not being detected”.
E-commerce is growing so fast that propels card payments. The main concern of analysts is that it can be vulnerable to hackers and cyber criminals. Consumers wonder how secure they are when they use their debit or credit cards for a purchase on a website. Security network companies are working on those matters to make the payment process more secure on the Internet.
Cash is not going to vanish so easy. There are consumers that do not feel good with using a card for their payments and purchases. A lot of people still don’t have access to the Internet available to them so it is difficult to replace cash use with anything alternative. For now, cash is remaining a strong competitor in transactions but it will not be for too much long.