Is Cash Still King?

February 02, 2018

When I was young, I thoroughly enjoyed playing computer games (this was before the release of the Nintendo, and we never had an Atari, so for a while I was relegated to sifting through computer games on disks). The really cool ones came in box packaging and were marketed using actual artwork – and the game never looked remotely as cool as what was on the box.  Anyhow, I remember wanting this specific game at the nearby store, so I mowed the lawn to earn enough money to buy it. My dad gave me cash and I rode my bike down to the store – it was pretty rewarding, even though it was just a video game. There was something about having cash put in my hand as a direct result of hard work that resonated with me. And I’ve been fortunate to be able to pass along that concept to my daughter – but, that may all be different by the time she has kids.

I recently found out local branches of some large banks (Bank of America, to name one) have ceased to accept cash deposits unless you are depositing into your own bank account (i.e., no more depositing cash into your nephew’s account to help with tuition). For most of us, is this really that much of an issue? You can still write a check, or make an electronic transfer to get those same funds into his account. And, when the bank says they’re trying to prevent money laundering, it makes sense, right? Okay, sure. But is this the beginning of something big?

It probably doesn’t come as a surprise to read that the use of cash by Americans in retail has been on the decline. Thinking about it, I make many more purchases online now than I did in the past – how many of us accomplished all of our Christmas shopping online this year for the first time? I know quite a few!  This doesn’t seem like such an issue at the outset, because we are choosing to make this change.  It’s at our convenience. But…what if we don’t have a choice? Say, when businesses stop accepting cash? That changes my perspective, for sure.

Other countries are already trending in the direction of a cashless society, beginning to ban large denomination bills in an effort to curb criminal transactions. The Bank of Korea (South Korea’s central bank) plans to go cashless by the year 2020, using instead a national digital currency comparable to bitcoin. There are pro’s and con’s to be considered – tax evasion would decrease; our privacy would certainly decrease (no money changes hands without a trail); vulnerability would increase (what happens in the case of a natural disaster? Could the proverbial “switch” just be flipped and the entire monetary system shut down?).  Whatever happens, it seems that we have some sizeable barriers between now and “cashless.”

Can I imagine life without cash? Yes, if I stretch my mind long enough…but what I see is definitely strange. No more handing $5 to a stranger in need; no more cash rewards to our kids for a job well done; no more “mattress money.” The list goes on.  What impact on your life today would you see if we were suddenly a cashless society?

About the Author

+Carolyn Kanabrocki is a consultant with Morrison & Company, providing business valuations, business planning (including budgeting, cash flow forecasting, and strategic planning), feasibility studies, interim controller services, recruitment, competitive grant writing and special projects that don't fit into any conventional category.  You can contact Carolyn directly at or via telephone at 530-893-4764 ext. 212.

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