Should America Keep Paper Money

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Table of Contents

Introduction
The Explanation of the Need for Keeping Paper Money
Conclusion
References

Introduction

In the contemporary world of globalization and digitalization, people tend to use electronic money rather than paper ones. However, there is no one opinion about whether society is prepared for a complete switch to intangible payment systems or the standard method of exchange should be kept. This essay will examine numerous reasons supporting the claim that people still need paper money in detail, contrasting it to a few pieces of evidence proving the opposite. The refutation of arguments for the complete switch to digital payment systems and the conclusion will be provided.

The Explanation of the Need for Keeping Paper Money

Human Rights and Tradition

It is possible to begin the discussion of the need for keeping paper currency from referring to the rights of any people. Forcing consumers to switch their preferences from cash to digital money is inappropriate and discriminatory (Kim, 2019; Rogoff, 2014). Some customers do not want anyone to have access to the list of their purchases or like to pay in cash. Moreover, there are young people who do not have established credit cards yet and, therefore, are deprived of a right to buy anything on a legal basis (Kim, 2019, p. 9). Even the term “unbanked” exists and refers to people who do not have bank or credit union access for any reason, and therefore, will not have an opportunity to pay without paper money. Therefore, it is vital not to exclude those who do not pay in cash.

Another significant human right is privacy, which is frequently expressed through non-digital currency use. If someone wants to stay anonymous, they, for instance, donate money to charity in cash. It is not possible to keep spending conferential with electronic money, as they must be held by a third-party custodian (Rahn, 2014, para. 7). The other point for keeping paper money is a human right to stick to traditions. Some individuals prefer to conduct small payments using paper money, which also eliminates bookkeeping and tracking. If the mentioned-above issues are not respected, basic human rights are violated, which should be considered before switching to digital currency.

Assistance in Crimes Prevention

IIt is understandable that governments like electronic money, as they are easily monitored and “safe” while paper ones can be stolen. However, this perspective has an opposite perspective, which reveals non-digital currency as more useful with respect to the prevention of crimes. With the spread of electronic payments, people started to carry with themselves less paper money, which has always been a reason for thieves to commit a robbery.

However, credit cards usually have more money on them than people tend to carry, which results in more significant losses if someone’s car is stolen. According to Mercadante (2020), “In certain financial transactions, perhaps even with certain businesses, the best protection against identity theft is the pay by cash” (Cash is the best remedy for identity theft section). In addition, using cash does not require giving aby personal information that might be used to someone taking false credit on use of digital currency’s name. Therefore, paper money is safer and more likely to prevent crimes than electronic one in some situations.

Cash as a Necessity for Poor and Older Individuals

Society still should care about those who cannot use electronic money for any other reason but the above-mentioned ones. Poor and older individuals rely on cash, and this issue should be addressed before stitching to digital currency. According to Kim (2019), “We currently do not have the financial infrastructure in place that has addressed the needs of low or moderateincome communities and workers as it relates to movement into a cashless society” (p. 10).

It implies that it is not possible for the world to become cashless in the nearest future. At the same time, the older generation sometimes is not able to use electronic money, as most part of their life they have been paying in cash (Náñez Alonso et al., 2020). It is one of many other reasons why paper money should be kept before every part of society is not fully prepared for digitalization.

Cashless World is an Imminent Future

An opposite point of view reveals the rising tendency for a society to become cashless because it is more convenient for businesses, also considering that cash can transmit diseases. The recent COVID-19 pandemic grew awareness of viruses, which can reside on paper money (Savej, 2020). People prefer the safer way of paying that also contributes to the number of digital money supporters. It is also known that the number of cashless payments decreased by 23 percent from March 2020 to May 2020 (Savej, 2020, para. 8). Simultaneously, business owners claim, for instance, that “We used to be a 70 percent cash business, and now it’s about 10 percent cash” (Savej, 2020, para. 10). It indicates the strong tendency for digitalization in contemporary society.

However, uniting the two mentioned above arguments, it is possible to reveal that the situation does not facilitate complete digitalization, making the use of paper money still viable. According to Savej (2020), “It is extremely unlikely we will see a digital dollar happen under the current crisis, as there are much greater issues of monetary policy and financial stability (para. 10). It implies that despite most businesses tending to become completely cashless, it will unlikely happen during the next decade or two. In addition, Savej (2020) claims that “the transmission of the virus through banknotes is low when compared with other frequently touched objects, such as credit card terminals” (para. 11). Finally, it would be considered discriminatory against older people and those who cannot use credit cards if the world became cashless at once (Savej, 2020). Summarising everything, it is necessary for society to keep paper currency.

Conclusion

The world is tending to be more digital and faster, which raises the necessity to leave using paper money as the outdated payment method. The recent pandemic also contributed to this point of view, making people afraid of viruses transmitting via cash. The percentage of non-digital money usage in business was also significantly reduced. However, there is a set of reasons that indicates the impossibility of a complete switch to electronic currency.

Primarily, the financial system is not prepared for addressing the needs of such parts of society as younger and older generations and poor individuals. Other people who do not have a bank account can also be deprived of an opportunity to pay because of the prevalence of cashless methods. It is also inappropriate from the human rights perspective, as a user’s preferences, tradition to pay in cash, and right for privacy should be respected. Finally, in some cases, it is still safer to pay in non-digital methods to prevent crimes. Therefore, the world is not ready for a complete switch to electronic currency, and America should keep paper money.

References

Kim, H. H. (2019). The future of cash. CQ Researcher, 29(26), 1-49. Web.

Mercadante, K. (2020). The future of cash – will it disappear or become obsolete? MoneyUnder30. Web.

Náñez Alonso, S. L., Echarte Fernández, M. Á., Sanz Bas, D., & Kaczmarek, J. (2020). Reasons fostering or discouraging the implementation of Central Bank-backed digital currency: A review. Economies, 8(2), 1-27. Web.

Rahn, R. W. (2014). Why Do We Still Use Paper Money? CATO Institute. Web.

Rogoff, K. (Ed.). (2014). Proceedings of the NBER Macroeconomics Annual Conference. Harvard University.

Savej, N. (2020). America prepared for a brave new cashless world? InsideHook. Web.

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