Posted on: 13 May 2016
This week, Alexander Preston has money on his mind.
‘Find a penny, pick it up and all day long you’ll have good luck’. Perhaps not for those with paraskevidekatriaphobia, as today is best avoided. Indeed, the days of the penny seem numbered.
The coin is being withdrawn from circulation by the Canadian government, following the likes of Australia, Brazil, and Sweden.
The apparent demise of the penny is representative of a wider trend. In May 2015, the UK’s Payments Council said the use of cash by consumers, businesses and financial organisations fell to 48% of payments in the preceding year.
The remaining 52% was made up of electronic transactions.
The Payments Council, which oversees the system of transactions, said that moves towards debit card, contactless and mobile payments would drive the move away from cash, with cash volumes expected to fall by 30% over the next 10 years. It’s rare that I find any coins or notes in my wallet these days.
It’s a sentiment echoed by the Co-operative supermarket, which in recent weeks predicted that payments by mobile phone will exceed cash in the next decade. It claims that 65% of purchases in 2025 will be via mobiles, with bank cards and cash an historical throwback.
At this year’s PEC in Hamburg, IFPL and Panasonic outlined their respective responses. For instance, Panasonic’s Waterfront seat has an NFC feature. An unscientific poll of the room’s audience by IFPL highlighted the fact we, as consumers’ still place greater trust in contactless cards rather than mobile wallets, but the signs are certainly there that the tide is changing.
On a more scientific front, the digital infrastructure for mobile payments is becoming more coherent. Work towards greater standardisation in payment terminals is taking place, a very necessary objective, given the quicker refresh rate in mobile phone technology. Elsewhere, more collaboration between all stakeholders is actively taking place, which will ensure that consumers, merchants, OEMs and businesses benefit from mobile payments.
Contactless and mobile maybe the future, but the scramble down the back of the sofa for loose change, is set to continue, for some time yet.