Written by Amirah Sohaimi
Picture credit: Google
Since the past few days, the Internet has been ablaze with a statement by our local actress, claiming that Malaysia is going back to the age of barter system. The statement is a reply to a news headline by The Star Online – “Khairy: Malaysia to be cashless society by 2050.”
What does cashless society mean? According to a report entitled The Cost of Cash in the United Sates by Bhaskar and Benjamin Mazzotta, a cashless society describes an economic state whereby financial transaction is not conducted using money in the form of physical banknotes or coins, but rather, through the transfer of digital information (usually an electronic representation of money) between the transacting parties.
Until 2017, United Kingdom is viewed to be the third cashless society in the world, only two ranks behind Canada and Sweden, which are far ahead in the trend of dropping cash transactions. China ranks at number six in the list.
Malaysia? We are still far behind these countries.
As time passes and technology changes, we can see how people are willing to pay more when they pay with a card compared to when they are paying with cash. Swiping their credit card seems less painful than having to take out the hard-earned money from the wallet and pay.
But one less painful feeling does not mean one less problem ahead. One of the challenges for a country like Malaysia to influence people to migrate from cash would be the sense of security. We need to reassure people that high security is in place, from every aspect – the system, the transactions, well, basically everything – it’s about money we are talking about!
Before we become a cashless society, we need to make sure the people are well equipped with personal finance education. This is crucial because as you open yourself up to cashless transactions, you also open up yourself to cashless credit that might be a little out of hand if you have no self-control.
Picture credit: Google
We already have Visa PayWave as well as Samsung Pay in the market. But do small convenience stores accept cashless transactions for something worth less than RM10? Because in Japan, they do. Maybe, for this to happen, I’ll have to wait for another few years. Until then, I’ll save some cash in my wallet, just in case.