Mal Fletcher
'Wave & Pay' at Cashless London Olympics

The Visa credit card company has just signed a deal with Barclaycard in the UK to offer a new generation of ‘wave and pay’ plastic cards that require no PIN number to operate.

The cards will be used for small change purchases such as newspapers, bus tickets or loaves of bread. They will operate in the same way as London’s Oyster card, used for travel throughout the city.

The user will simply wave the card across a scanner and have his or her account automatically debited.

According to Britain’s Daily Mail, the spokesperson for Visa Europe has said that, ‘over 75% of cash payments [are] less than £10… The decision to go live [with this system] in less that a year supports our vision for a cashless Olympic Games in London in 2012.’

Under this system, purchases over £10 in value will still require a PIN – at least, for now. However, this needs to be seen in a much broader context.

This is simply the latest in a long line of actions taken by banks and other finance institutions; actions that are designed to wipe out the use of cash altogether, leaving us with a completely digital economy.

For some consumers, this can’t happen too soon. There are, of course, some benefits associated with digital cash, such as convenience of use and the ease with which digital trading allows us to deal instantly even over long distances.

However, there are some potential dangers in this headlong dive toward a zero-cash economy.

For some people, the switch to cashless will only exacerbate their struggle with debt. Studies have shown that overspenders are less inclined to face up to their problem when they deal only with digital money: credit cards, for example. They can’t see the value of their spending in terms of anything tangible, like cash-in-hand.

Such individuals may at first welcome the move to digital money, because they think it will lessen their feelings of guilt about overspending. In the long run, however, their problems may only intensify.

Then there’s the issue of privacy. If someone steals your cash, this doesn’t give them access to private information about you. They can’t use your cash to defraud you further or to steal your identity.

Identity-theft is already a major problem in many nations, driven as it is by the use of plastic cards. The more we rely on a card-culture, the more we’re going to see problems with stolen identities.

No amount of tweaking will solve the inherent security problems. Just as computer hackers and spammers continually find new ways to beat the latest internet security, so financial scammers will find holes in cashless trading systems.

Some social researchers are now claiming that privacy as we once knew it, just a generation ago, is dead. Everything is now so interconnected that it’s hard to keep personal information about yourself out of the public sphere.

As increasing amounts of information about us are stored in huge multi-national databases, the possibilities for abuse grow exponentially.

In our post-modern culture, two principles drive us. One is consumerist aspiration, the desire to own more and more. The other is information addiction, the need to gain knowledge -- even if we never plan to use it.

In this aquisitive and inquisitive world, controlling people’s behaviour is largely a matter of influencing the flow of money and information, or the means by which people trade in both.

As knowledge-freaks and ultra-consumers, we are easy targets for control. We constantly expose ourselves to media that store information about us. Every time we go online, we leave behind electronic footprints which others can use to track where we’ve been.

Technology and information are amoral; but human beings have shown again and again their capacity to turn amoral things to immoral purposes.

The first step in the move toward a digital economy was the introduction of the now ubiquitous credit card.

The credit card was born in the US sometime in the 1920s, when individual companies issued them to their customers. But these cards could only be used to buy things from those companies. It wasn’t until the 1950s that Diners Club introduced the world’s first universal credit card.

Soon, banks started issuing credit cards of their own and they quickly became the most popular kind of card.

Once upon a time, credit cards operated simply as a convenient, now-and-again substitute for cash. Many people resisted them – many still do – because they represent for them an unrealistic world, where money is invisible and therefore easy to abuse.

But over time, cards have taken on more and more importance. New features have been added to many cards -- such as photos and computer chips.

These days, credit cards are even seen as a major form of identification. In some airports, they’ve been given the same ID status as a passport, although this has fallen off since 9/11.

Now, there’s even talk of merging some credit cards with government-issued ID cards.

At each step of the deliberate process of de-cashing our economy, banks have sold us on the benefits of doing away with cash. Soon, society will adopt ‘wave and pay’ on a large scale. You can be sure it won’t be limited to small purchases for long.

After a while, new alternatives will be offered – at first as options, then as the norm.

Officials will tell us that, in the interests of personal security, that we need to link our means of spending even more directly to our personal identities.

From there, it’s a small step to ‘identity branding’. And from there, perhaps a small step to the world of Big Brother.

The bottom line is this: we each need to make a choice now. That our lives will be about more than the drive to consume either goods or knowledge.


Mal Fletcher (@MalFletcher) is the founder and chairman of 2030Plus. He is a respected keynote speaker, social commentator and social futurist, author and broadcaster based in London.

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