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We have entered a World without Cash

By HLundgaard - Own work, CC BY-SA 3.0,

The European Central Bank has decided to end the production and issuance of €500 banknotes - 600 million of such banknotes were in circulation in 2015 - by the end of 2018. This decision, under the guise of combatting organized crime, is a further step towards eliminating cash. It is a fact that many governments and central bank authorities make no bones about the fact that their ultimate goal is a cashless society. Yet, it is undeniable that many criminal networks throughout the world make a significant use of high-denomination banknotes. But it is also obvious that the elimination of such banknotes will not eradicate organized crime. The relevant authorities put forward 3 main arguments why cash should be banned: the issue of banknotes is very expensive; in a difficult economic and financial environment and especially today with the introduction of negative interest rates, this would prevent the bank's client to keep their money under their mattress; and governments can easily track and control electronic money. But on the other hand, those who support the use of cash provide equally compelling arguments: forcing people to conduct transactions electronically is a serious attack on their freedom; storing their savings safety even under their beds can constitute an ultimate rampart against devastating economic policies. Not surprisingly, there are divergent views on this matter. Countries like Germany or Austria are not in favor of a cashless society. In contrast, countries like Sweden or Denmark want to achieve a cashless society by 2030. Now we have to admit that the rapid development of new technologies, in particular digital technologies, is a crucial advantage for the supporters of a world without cash.

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