How Many Coins Do You Carry?
One of my personal frustrations with money is carrying cash, more specifically coins. While admittedly my jet-setting isn't the best benchmark for comparison, I am often disappointed in the ability to leverage the full utility value of cash. Take for example loose change, which over time with inflation has seen its' buying power decrease to levels that make carrying coins undesirable. Let's face it, there isn't much you can buy with coins in an urban environment, other than public transport or parking meters. If your like me, they always end up in a busker or beggars hat. In a recent poll, carried out by Visa Europe revealed that Irish adults carry an average of €23 in cash on a daily basis. While Personal-Finance blogger J. Money lists four reasons you should always have at least some cash on you.
- Not every venue accepts plastic. Examples: toll booths, some cab companies, vending machines.
- You can't always find an ATM.
- Cash makes it easier to split the check fairly.
And then there's what I think is the most important reason of all, "You don't wanna be 'that guy' who is always bumming a few dollars for something". This is particularly true if you're also that guy who conveniently forgets to pay the money back. Which appears to be a common theme. People continue to carry cash to avoid being caught without it, with a strong emphasis on not being caught out during a social occasion.
On the flip side, multiple innovations in the money space have attempted to tackle the cash challenge, pushing digital alternatives into traditionally cash based ecosystems and economies. But can they really replace coins? Its a utopian dream that many chase, but very few come close to realising. The strongest case studies tend to come in the form of transportation card that can evolved into cash cards, like Octopus, Oyster, Felica and EzLink. Many of these programs have seen amazing success, but not through customer choice. Instead commuters are forced to use the card as the new ticketing utility. But not all implementations have seen warm welcomes to the market. In Melbourne, with the Transport Authority selected to 'copy' the Hong Kong system during the implementation of their MyKi system, commuters outrage was continually expressed as implementation delays and scarcity of cards made the consumer migration 'rough'.
So how can a city create something that has all the utility of cash, but without the adoption issues seen across the globe? One thing for sure is the bridge for changing consumer or commuter behaviour has to been seamless and intuitive. Think of the transition to the iPod from CDs, consumers just intuitively understood the new device. Icon association, menu and task flows were simple, and easy to follow with little instruction. But at its core, an implementation needs to build trust in the community that they can safely leave home without purse or pocket full of cash or coins.
Let's not forget that the creation and circulation of currency in the form of cash is a huge expense on federal budgets funded by taxpayer dollars. Yet, many of the most successful cash cards are privately funded. Is there room to reduce the cost of currency, to support stronger digital alternatives?
I’d like propose a global search for the first economy to truly embrace the digital currency at a level that coins can be replaced. It’s a tall order, but it should prove to be the most exciting development in currency globally in the past century. I've seen some bold attempts in infrastructure devastated nations such as Haiti or The Maldives, but nothing from a developed nation.