Less Cash… More Data

Less Cash… More Data

Now and again, a journalist or filmmaker carries out an experiment where they try to follow a dollar bill or £10 note on its travels from cashpoints to shops to banks and round again. Fascinating as such accounts can be, they are rare simply because of the hassle involved in tracking a particular coin or note. With the vast majority of cash transactions, there’s no record of who made the purchase, with the details of when and where often hazy at best.

However, this could soon be a thing of the past as cashless payment becomes increasingly dominant. In 2014, more than half of all payments involved a non-cash method such as card, bank transfer or electronic payment. When the figures for 2015 are complete, they are expected to show a similar case even for consumer payments alone.

Cashless payments are no longer used just for the larger credit card items consumers buy, but even small convenience items such as a morning coffee en-route to work can be paid for with a simple quick swipe of a card against a terminal and further to this smartphones can now be used as well, such as Apple Pay.

In addition to the convenience of cashless payments, one of the big differences with cashless transactions is that they all create data records which include location data. If a customer uses a card in a payment terminal, there’s a record of when and where it happened. If they use a computer, a record exists of the IP address – something that can usually be related to a physical location. If they use a mobile payment app (depending on the settings), anything from their general location (based on nearby phone towers or Wi-Fi connections) to their precise GPS positioning can be captured.

It’s no secret that police and security staff use transaction data to track people’s movements: just look at the recent Channel 4 fugitive-themed gameshow “Hunted”. Smart players took out as much cash as possible in one go and never went near a cashpoint again. But it’s an increasing opportunity for businesses to learn more about our daily movements, whether it’s that morning coffee on the high street, drinks after work or that late-night taxi ride home.

Whether this is to society’s benefit is up for debate. For some, it’s a creepy example of ever-growing surveillance of our lives. For others, it’s a way businesses can learn more about their customers and improve their service. Either way, a cashless society is looking less farfetched every day, so it’s time to think about all of the consequences.

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