The prevalence of cash has taken a nosedive in recent years. While carrying wads of bills, fiddling with pocket change, and making visits to the ATM used to be standard, they’re becoming archaic in today’s digital society. Instead, many consumers are leaning on credit cards to make their purchases more convenient.

The idea of credit card was first established back in 1950, when a man named Frank McNamara went out to dinner and forgot his wallet. He negotiated with the restaurant to wash dishes in exchange for a delayed payment, inspiring him to create a credit-based payment system. This soon led to the development of the first consumer-facing credit card company, The Diner’s Club.

When Bank of America and American Express first unveiled credit cards, merchants all over the US became infatuated by the perks of a swipe. This fixation has run so deep that one in five Americans believe that payments will be completely cash-free within their lifetime.

But there are both costs and benefits to embracing a completely cashless culture…

The Card Craze

cards online

Cards provide convenience in several ways. They keep up with the demands of online shopping, enable large, instant purchases, provide a cushion for emergencies, replace low-value cash transactions, and generate rewards. They also boost consumer spending. In fact, 84% of consumers do more damage when spending with a credit card.

Cards also benefit businesses by facilitating faster, more seamless transactions. This limits the time a shopper has to stand in line – reducing wait times, keeping customers happy, and ensuring a smoothly run business.

Cards cater to the cardholder and the business owner. This could be why nearly one third of U.S. adults report that they don’t use cash at all during a typical week. Meanwhile, pure cash usage has been steadily dwindling, with only 18% of people making all of their purchases with bills and coins. While cash usage declines, cards continue to gain traction in today’s market.

But plastic isn’t the only alternative to a cash culture.

Beyond Cards

When PayPal began in 1998, its founders built an alternative to both cash usage and card swiping. It allowed consumers to pay, send money, and accept payments online by registering their credit or debit cards. With Elon Musk’s influence, PayPal became a leading platform for consumers and businesses alike, making it easy to complete money transfers without any physical transactions.                                                                                              

When PayPal acquired Venmo in 2014, the virtual payment landscape was amplified even further. Venmo is an app that connects to users’ card numbers and allows instant currency transfer between friends. This makes payments quick, simple and casual.

Payment apps like Venmo are rapidly influencing our culture’s spending habits. In fact, three in four millennials have made payments with money-transferring apps. From paying rent to splitting the bill at a restaurant – Millennials and GenX’s are already moving beyond traditional plastic.

However, the convenience we seek from cards and their digital counterparts comes at a price…

A Hefty Price to Pay


A completely cashless culture would make the repercussions of not qualifying for a credit card much more significant. People who don’t qualify for basic cards would have to turn to those with disproportionate interest rates in order to participate in a cashless world. This, in turn, would lead to amplified debt.

People also lose a sense of security and privacy without promised cash. If an online system malfunctions or is hacked, we are disconnected from what is ours. This means we’d have to lean on companies and the government to safeguard our privacy, which may not be the most promising caretaker (cue the Cambridge Analytica scandal).

A cashless society also limits the ability to react in times of a natural disaster. For instance, when Hurricane Maria hit, Puerto Rico lost all power. The swipe of a card, or a digital transaction became impossible, meaning physical cash was the only means of support in a critical time of need.

If we do go cashless, strict safeguards would need to be put in place in order to protect consumers and their currency.

The Cards in Our Future

In a society historically affixed to cash, it’s going to take some time before cards make cash obsolete. While paying with cash is tedious and restricted, having it is reassuring - it enables a promised, reliable form of payment.

It’s only a matter of time before cash becomes archaic in a society obsessed with digital evolution. Cell phones have replaced landlines, digital security systems have supplanted padlocks and app-based rideshares have given taxis a run for their money. 

Although it might take a great deal of time before cards replace physical cash, one thing is for sure – pretty soon, “cash only” signs will be an urban legend.

How do you feel about living in a card culture? Let us know on LinkedIn! 

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