Different Forms Of Cashless Payments

Cashless Name: Institution: Introduction A cashless society refers to an economic concept where most financial transactions are conducted in an electronic format instead of using other forms of payment such as cash banknotes. In a cashless economy, people buy goods and services through the use of electronic payment instead of using coins and papers. A cashless society may be envisioned as a conceptualization out of science fiction but different countries and societies have already started implementing this form of payment. It is important to understand that there are several powerful forces which are behind the cash-free world and they include big financial companies, governments as well as the critics of the ordinary and conventional financial system. This paper will examine the different forms of cashless payments and also evaluate their benefits and limitations. The use of cash has been declining for the past few years. Interestingly, it is rapidly being replaced by different digital payment platforms. Electronic payment systems have continued acquiring a large market share and are highly preferred since they are more secure and highly traceable because it leaves footprints. The increase in digital solutions has promoted the growth of e-commerce. Also, individuals and businesses have been capacitated to access financial services that they lacked previously. Different countries across the world have begun shifting towards the cashless payment systems. The growth of the internet and digital payment infrastructures has promoted the increase of contactless payment methods and the development of mobile technologies which have significantly slowed the use of cash. For example, in the United Kingdom, it is estimated that only about thirty-four percent of transactions are made through the use of cash. Instead, people have adopted debit cards which have become the most accepted payment technique. In Sweden, the use of cash has also significantly reduced and it is estimated that cash transactions will be almost inexistence by 2020 (Marria, 2018). The high acceleration towards digital payment methods is likely to cause banks and other organizations providing financial services to replace their cash supporting infrastructures and this may cause their customers unaware. Many people around the world are at the risk of being excluded from the new systems. The most affected individuals are the elderly and people who are unbanked. Some of the countries that have made significant steps towards cashless society may include Sweden where half of the population use Swish, a popular mobile payment application most used in payment transfers both to individuals and in business. In Sweden, some stores no longer accept cash payment and these systems have also been incorporated in transport systems where passengers are required to pay using their debit or credit cards. Other countries such as China have adopted unique forms of cashless payment such as QR codes which are used in supermarkets, temple donations and in markets. African countries such as South Africa are have also adopted mobile payment services, this has been facilitated by increased use of smartphones (Humbani & Wiese, 2018). Additionally, mobile service providers and banks in Africa have also actively promoted the use of mobile payment. Cashless Payment Methods Technology and innovations have increased the number of cashless payments that are available for individuals and businesses. These are some of the most common forms of digital payments that are used in different countries across the world. E-Wallets It is also known as electronic wallets and it is a digital system which enables the user to store his or her credit cards, debit cards and bank account numbers in a secure environment and it also eliminates the need for entering account information when making payments. It makes it possible for an individual to make a payment without necessarily remembering or keying the account details. The two essential components of E-wallet are software and information. The software helps in securing personal data through encryption while information is the database of the user details. E-wallet accounts are mainly safeguarded using passwords. It is also important to note that E-wallets may be used in supermarkets, grocery store and paying bus tickets. Mobile Payments This refers to any form of payments that are made using the mobile device (Chen, 2008). The increase of smartphone dep...